Q1 2026 Alamos Gold Inc Earnings Call

April 30, 2026

Operator 2: Good morning. I'll now turn the call over to Scott Parsons, sorry, Alamos Senior Vice President of Corporate Development and Investor Relations. Please go ahead.

Operator: Good morning. I'll now turn the call over to Scott Parsons, sorry, Alamos Senior Vice President of Corporate Development and Investor Relations. Please go ahead.

Scott Parsons: Thank you, operator, and thanks to everybody for attending Alamos' Q1 2026 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. 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, please refer to the cautionary notes included in the presentation, news release, and MD&A, as well as the risk factors set out in our annual information form. Technical information in this presentation has been reviewed and approved by Chris Bostwick, our Senior VP, Technical Services, and a qualified person.

Scott Parsons: Thank you, operator, and thanks to everybody for attending Alamos' Q1 2026 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. 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, please refer to the cautionary notes included in the presentation, news release, and MD&A, as well as the risk factors set out in our annual information form. Technical information in this presentation has been reviewed and approved by Chris Bostwick, our Senior VP, Technical Services, and a qualified person.

Speaker #1: In addition to myself, we have on the line today John McClusky, President and Chief Executive Officer; Greg Fisher, Chief Financial Officer; and Luke Guimond, Chief Operating Officer.

Speaker #1: We will be referring to a presentation during the conference call that is available through the webcast and on our website. I would also like to remind everyone that our presentation will be followed by a Q&A session.

Speaker #1: As we will be making forward-looking statements during the call, please refer to the cautionary notes included in the presentation news release and MD&A, as well as the risk factors set out in our annual information form.

Speaker #1: Technical information in this presentation has been reviewed and approved by Chris Boswick, our Senior VP Technical Services, and a qualified person. Also, please bear in mind that all the dollar amounts mentioned in this conference call are in US dollars unless otherwise noted.

John McCluskey: Also, please bear in mind that all the dollar amounts mentioned in this conference call are in US dollars, unless otherwise noted. Now John will provide you with an overview of the quarter.

Scott Parsons: Also, please bear in mind that all the dollar amounts mentioned in this conference call are in US dollars, unless otherwise noted. Now John will provide you with an overview of the quarter.

Speaker #1: Now, John will provide you with an overview of the quarter. Thank you, Scott. And I'm going to start with Slide 3. The first quarter production was $124,000 in line with quarterly guidance.

John McCluskey: Thank you, Scott. I'm going to start with slide 3. Q1 production was 124,000 ounces, in line with quarterly guidance, with a strong performance from the Island Gold District offsetting lower than planned production at Young-Davidson. The Island Gold District had a solid overall quarter with the shaft and larger mill expansion advancing, underground mining rates increasing to a new record of over 1,400 tons per day, and a significant improvement in Magino's milling rates over the past 6 weeks. The continued ramp-up of underground mining rates at Island Gold, as well as improvements in mining rates and grades at Young-Davidson, are expected to increase our Q2 production by approximately 20%. With the Island Gold District expected to drive further production growth in the H2 of the year, we may remain well on track to meeting our full-year production guidance.

John McCluskey: Thank you, Scott. I'm going to start with slide three. Q1 production was 124,000 ounces, in line with quarterly guidance, with a strong performance from the Island Gold District offsetting lower than planned production at Young-Davidson. The Island Gold District had a solid overall quarter with the shaft and larger mill expansion advancing, underground mining rates increasing to a new record of over 1,400 tons per day, and a significant improvement in Magino's milling rates over the past 6 weeks. The continued ramp-up of underground mining rates at Island Gold, as well as improvements in mining rates and grades at Young-Davidson, are expected to increase our Q2 production by approximately 20%. With the Island Gold District expected to drive further production growth in the H2 of the year, we may remain well on track to meeting our full-year production guidance.

Speaker #1: With a strong performance from the Island Gold District, offsetting lower than planned production at Young Davidson. The Island Gold District had a solid overall quarter with a shaft and larger mill expansion advancing, underground mining rates increasing to a new record of over 1,400 tons per day, and a significant improvement in Magino's milling rates over the past six weeks.

Speaker #1: The continued ramp-up of underground mining rates at Island Gold, as well as improvements in mining rates and grades at Young Davidson, are expected to increase our second quarter production by approximately 20%.

Speaker #1: With the Island Gold District expected to drive further production growth in the second half of the year, we remain well on track to meeting our full-year production guidance.

Speaker #1: With our year-end disclosure in February, we guided to costs for the first quarter being above the first half guidance range. All in sustaining costs were $1,862 per ounce and are expected to decrease by approximately 5% during the second quarter.

John McCluskey: With our year-end disclosure in February, we guided to costs for Q1 being above the H1 guidance range. All-in sustaining costs were $1,862 per ounce and are expected to decrease by approximately 5% during Q2. A more significant improvement is expected into H2 of the year, reflecting an increase in low-cost production from the Island Gold District. Financially, we had another strong quarter with record revenues and margins. Relative to a year ago, our All-in sustaining cost margins nearly tripled to approximately $3,000 per ounce. This contributed to record cash flow from operations and another solid quarter of free cash flow of $102 million while reinvesting in high return growth. Turning to slide 4.

Speaker #1: A more significant improvement is expected into the second half of the year reflecting an increase in low-cost production from the Island Gold District. Financially, we had another strong quarter with record revenues and margins.

Speaker #1: Relative to a year ago, our all-in sustaining cost margins nearly tripled to approximately $3,000 per ounce. This contributed to record cash flow from operations and another solid quarter of free cash flow of $102 million, while reinvesting in high-return growth.

Speaker #1: Now, turning to Slide 4, we had a catalyst-rich first quarter that included releasing highlights of a successful 2005-25 exploration program across our portfolio. This supported a 32% increase in year-end mineral reserves to $16 million ounces, and included a near doubling of reserves at the Island Gold District to over $8 million ounces.

John McCluskey: We had a catalyst-rich Q1 that included releasing highlights of a successful 2025 exploration program across our portfolio. This supported a 32% increase in year-end mineral reserves to 16 million ounces and included a near doubling of reserves at the Island Gold District to over 8 million ounces. This growth was incorporated into the Island Gold District expansion study, which was also released in Q1. The study outlined a large, long life, low-cost operation that is expected to be one of Canada's most profitable mines. At a $4,500 per ounce gold price, the Island Gold District is expected to generate over $1 billion in annual free cash flow and has a $12 billion after-tax NPV, making it one of the most valuable gold mines in Canada.

Speaker #1: This growth was incorporated into the Island Gold District expansion study, which was also released in the first quarter. The study outlined a large long-life low-cost operation that is expected to be one of Canada's most profitable mines.

Speaker #1: At a $4,500 per ounce gold price, the Island Gold District is expected to generate over $1 billion in annual free cash flow and has a $12 billion after-tax NPV, making it one of the most valuable gold mines in Canada.

Speaker #1: Based on the ongoing exploration success, we are seeing across the district we believe there is further upside to come. Toward the end of the first quarter, the shaft sink at Island Gold reached its planned depth of 1,381 meters.

John McCluskey: Based on the ongoing exploration success we are seeing across the district, we believe there is further upside to come. Toward the end of the first quarter, the shaft sink at Island Gold reached its planned depth, 1,381 meters. We expect to complete the commissioning of the shaft early in 2027, which will be a key catalyst driving a further increase in production and decrease in costs. With strong ongoing free cash flow generation at current gold prices and significant growth expected ahead, we announced a 60% increase in our dividend in February and will continue evaluating opportunities for additional shareholder returns. Turning to slide five. We have previously outlined a clear path to 800,000 ounces of annual production by 2028, with costs expected to decrease 18% relative to 2025.

Speaker #1: We expect to complete the commissioning of the shaft early in 2027, which will be a key catalyst driving a further increase in production and decrease in costs.

Speaker #1: With strong ongoing free cash flow generation at current gold prices and significant growth expected ahead, we announced a 60% increase in our dividend in February and will continue evaluating opportunities for additional shareholder returns.

Speaker #1: Turning to Slide 5, we have previously outlined a clear path to $800,000 ounces of annual production by 2028, with costs expected to decrease 18% relative to 2025.

Speaker #1: We expect our annual production to continue increasing to $1 million ounces by 2030, with a further decrease in costs. This growth is expected to be internally funded by ongoing free cash flow generation and a strong balance sheet with $1.2 billion in available liquidity.

John McCluskey: We expect our annual production to continue increasing to 1 million ounces by 2030, with a further decrease in costs. This growth is expected to be internally funded by ongoing free cash flow generation and a strong balance sheet with $1.2 billion in available liquidity. Our team is making strides towards our long-term plans across our asset portfolio. The completion of the Phase Three Plus shaft expansion at Island Gold is less than a year away. Our larger Magino mill expansion is well underway, and construction activities are ramping up at Lynn Lake and PDA. These are high return projects, all lower cost and largely de-risked, underpinning one of the best growth profiles in the sector. I'll now turn the call over to our CFO, Greg Fisher, to review our financial performance. Greg?

Speaker #1: Our team is making strides towards our long-term plans across our asset portfolio. The completion of the Phase 3 plus shaft expansion at Island Gold is less than a year away, our larger Magino mill expansion is well underway, and construction activities are ramping up at Lynn Lake and PDA.

Speaker #1: These are high-return projects all lower cost and largely de-risked. Underpinning one of the best growth profiles in the sector. I'll now turn the call over to our CFO, Greg Fisher, to review our financial performance.

Speaker #1: Greg? Thank you, John. Moving to Slide 6, we sold $122,000 ounces of gold in the first quarter at an average realized price of $4,829 per ounce.

Greg Fisher: Thank you, John. Moving to slide 6. We sold 122,000 ounces of gold in Q1 at an average realized price of $4,829 per ounce for record quarterly revenues of $597 million. Total cash costs were $1,230 per ounce, and All-in sustaining costs were $1,862 per ounce. As previously disclosed, Q1 costs were expected to be above the H1's guidance range.

Speaker #1: For record quarterly revenues of $597 million. Total cash costs were $1,230 per ounce. An all-in sustaining costs were $1,862 per ounce. As previously disclosed, first quarter costs were expected to be above the first half guidance range.

Speaker #1: We are continuing to monitor the impact of ongoing inflationary pressures across our cost structure, including higher labor, contractor, diesel, and electricity costs. We expect to manage any cost pressures with ongoing productivity improvements through the year, which are expected to drive costs lower and significant margin expansion at current gold prices.

Greg Fisher: We are continuing to monitor the impact of ongoing inflationary pressures across our cost structure, including higher labor, contractor, diesel, and electricity costs. We expect to manage any cost pressures with ongoing productivity improvements through the year, which are expected to drive costs lower and significant margin expansion at current gold prices. Operating cash flow before changes in non-cash working capital increased to a record $338 million in Q1, or $0.80 per share. This included a reduction of $43 million, or $0.10 per share, for cash utilized to buy out an additional 15,000 ounces of the legacy Argonaut Gold hedges prior to maturity. Our reported net earnings were $191 million in Q1, or $0.46 per share.

Speaker #1: Operating cash flow before changes in non-cash working capital, increased to a record $338 million in the first quarter, or 80 cents per share. This included a reduction of $43 million or 10 cents per share for cash utilized to buy out an additional 15,000 ounces of the legacy Argonaut gold hedges prior to maturity.

Speaker #1: Our reported net earnings were $191 million in the first quarter, or $46 cents per share. This included after-tax losses on commodity hedge derivatives of $20 million, adjustments for unrealized foreign exchange losses of $19 million, and other adjustments of $1 million.

Greg Fisher: This included after-tax losses on commodity hedge derivatives of $20 million, adjustments for unrealized foreign exchange losses of $19 million, and other adjustments of $1 million. Excluding these items, our adjusted net earnings were $232 million, or $0.55 per share. Capital spending in Q1 totaled $184 million and included $45 million of sustaining capital, $127 million of growth capital, and $11 million of capitalized exploration. We continue to fund our high return growth internally while generating strong free cash flow. This included $102 million of free cash flow generated in Q1, net of $82 million in cash taxes paid. In Q1, we repurchased and eliminated an additional 15,000 ounces of gold forward contracts ahead of their maturity in H2 2026.

Speaker #1: Excluding these items, our adjusted net earnings were $232 million or $55 cents per share. Capital spending in the quarter totaled $184 million and included $45 million of sustaining capital, $127 million of growth capital, and $11 million of capitalized exploration.

Speaker #1: We continue to fund our high-return growth internally while generating strong free cash flow. This included $102 million of free cash flow generated in the first quarter, net of $82 million in cash taxes paid.

Speaker #1: In the first quarter, we repurchased and eliminated an additional $15,000 ounces of gold forward contracts ahead of their maturity in the second half of 2026.

Speaker #1: These hedges were inherited as part of the Argonaut gold acquisition in 2024. Existing cash of $43 million was used to eliminate these hedges providing further upside to higher gold prices.

Greg Fisher: These hedges were inherited as part of the Argonaut Gold acquisition in 2024. Existing cash of $43 million was used to eliminate these hedges, providing further upside to higher gold prices. To date, we have eliminated 245,000 out of the 330,000 ounces that were hedged by Argonaut prior to maturity. We will continue to monitor opportunities to repurchase and eliminate the remaining contracts, which total 85,000 ounces across H2 2026 and H1 2027. Our ongoing free cash flow drove a further increase in our cash position to $660 million at the end of Q1. We expect growing production and declining costs to drive stronger free cash flow through the remainder of the year and into the next several years while continuing to self-fund our organic growth plans.

Speaker #1: To date, we have eliminated $245,000 out of the $330,000 ounces that were hedged by Argonaut prior to maturity. We will continue to monitor opportunities to repurchase and eliminate the remaining contracts, which total $85,000 ounces across the second half of 2026 and first half of 2027.

Speaker #1: Our ongoing free cash flow drove a further increase in our cash position to $660 million at the end of the first quarter. We expect growing production and declining costs to drive stronger free cash flow through the remainder of the year and into the next several years, while continuing to self-fund our organic growth plans.

Speaker #1: I'll now turn the call over to our COO, Luke Guimond, to provide an overview of our operations. Luke? Thank you, Greg. Over to Slide 7.

Greg Fisher: I'll now turn the call over to our COO, Luc Guimond, to provide an overview of our operations. Luc?

Luc Guimond: Thank you, Greg. Over to slide seven. Q1 production from the Island Gold District totaled 61,200 ounces, in line with plan and an improvement from the previous quarter. Underground mining rates averaged a record 1,423 tons per day, a 23% increase from Q4 and in line with our ramp-up schedule. Grades mined of 9.4 grams per ton were also consistent with guidance. We expect a gradual ramp-up of mining rates to 2,000 tons per day by the end of 2026 and higher grades into H2 to drive growing production through the rest of 2026. Open pit operations continued to perform well with mining rates averaging 50,000 tons per day, including nearly 12,000 tons per day of ore mined during the quarter.

Speaker #1: First quarter production from the Island Gold District totaled $61,200 ounces. In line with plan and an improvement from the previous quarter. Underground mining rates averaged a record $1,423 tons per day.

Speaker #1: A 23% increase from the fourth quarter and in line with our ramp-up schedule. Grades mined of 9.4 grams per ton were also consistent with guidance.

Speaker #1: We expect a gradual ramp-up of mining rates to 2,000 tons per day by the end of 2026 and higher grades into the second half of the year, to drive growing production through the rest of 2026.

Speaker #1: Open pit operations continue to perform well with mining rates averaging $50,000 tons per day. Including nearly $12,000 tons per day of ore, mined during the quarter.

Speaker #1: Grades mined in milled were in line with guidance. Total milling rates from the Island Gold District averaged close to 8,800 tons per day in the first quarter, with the Magino mill averaging 7,500 tons per day and the Island Gold mill averaging 1,260 tons per day.

Luc Guimond: Grades mined and milled were in line with guidance. Total milling rates from the Island Gold District averaged close to 8,800 tons per day in Q1, with the Magino Mill averaging 7,500 tons per day and the Island Gold Mill averaging 1,260 tons per day. Magino's milling rates are expected to increase in Q2 and through H2 of the year, driven by recent improvements to the crushing circuit. Total cash costs and mine site all-in sustaining costs were above annual guidance, but expected to decrease significantly in H2 of the year. This is expected to be driven by higher mill throughput at Magino, as well as an increase in underground mining rates and grades at Island Gold.

Speaker #1: Magino's milling rates are expected to increase in the second quarter and through the second half of the year, driven by recent improvements to the crushing circuit.

Speaker #1: Total cash costs and mine site all-in sustaining costs were above annual guidance, but expected to decrease significantly in the second half of the year.

Speaker #1: This is expected to be driven by higher mill throughput at Magino, as well as an increase in underground mining rates and grades at Island Gold.

Speaker #1: The Island Gold District generated mine site free cash flow of $58 million in the first quarter, net of the significant capital investment related to the Phase Three Plus shaft project, larger mill, larger Magino mill expansion, and exploration.

Luc Guimond: The Island Gold District generated mine site free cash flow of $58 million in Q1, net of the significant capital investment related to the Phase Three Plus shaft project, larger Magino Mill expansion, and exploration. At current gold prices, the Island Gold District is expected to continue generating strong free cash flow while funding its expansion plans and a large exploration program. Moving to slide 8. In the latter part of February, a temporary crusher was added to the Magino Mill, providing supplementary crushed ore feed into the processing plant. The addition of the crusher has contributed to a substantial improvement in milling rates, which averaged 9,200 tons per day over the past 6 weeks. Milling rates are expected to remain at similar levels in Q2, with the SAG and ball mill liner changes and conveyor replacements scheduled for the quarter.

Speaker #1: At current gold prices, the Island Gold District is expected to continue generating strong free cash flow while funding its expansion plans and a large exploration program.

Speaker #1: Moving to Slide 8. In the latter part of February, a temporary crusher was added to the Magino mill, providing supplementary crushed ore feed into the processing plant.

Speaker #1: The addition of the crusher has contributed to a substantial improvement in milling rates, which averaged 9,200 tons per day, over the past six weeks.

Speaker #1: Milling rates are expected to remain at similar levels in the second quarter, with a sag and ball mill liner changes and conveyor replacements scheduled for the quarter.

Speaker #1: Consistent with guidance, milling rates are expected to increase to a steady state levels of 10,000 tons per day, by the third quarter. Combined with the Island Gold mill, the district is expected to process in excess of 11,000 tons per day of ore, in the second half of the year, and into 2027.

Luc Guimond: Consistent with guidance, milling rates are expected to increase to steady state levels of 10,000 tons per day by Q3. Combined with the Island Gold Mill, the district is expected to process in excess of 11,000 tons per day of ore in H2 of the year and into 2027. Over the long term, a number of initiatives currently underway are expected to support higher milling rates and greater operational consistency. Connecting the Magino Mill to grid power will provide a more reliable source of power at substantially lower costs into 2027. Additionally, the construction of a gyratory crusher, new truck dump configuration, and ore bins will greatly improve the performance of the existing circuit by reducing rehandling of ore and ensuring a more consistent flow of ore into the mill.

Speaker #1: Over the long term, a number of initiatives currently underway are expected to support higher milling rates and greater operational consistency. Connecting the Magino mill to grid power will provide a more reliable source of power at substantially lower costs into 2027.

Speaker #1: Additionally, the construction of a gyratory crusher new truck dump configuration and ore bins will greatly improve the performance of the existing circuit by reducing re-handling of ore, ensuring a more consistent flow of ore into the mill.

Speaker #1: All of these improvements will be in place by early 2028, as part of the larger mill expansion to 20,000 tons per day. Moving to Slide 9.

Luc Guimond: All of these improvements will be in place by early 2028 as part of the larger mill expansion to 20,000 tons per day. Moving to slide nine, growth capital for the Phase Three Plus shaft expansion has been largely all spent or committed. Shaft sinking to a planned depth of 1,381 meters was completed in Q1, and paste plant construction is on track for completion in Q2. Commissioning of the shaft and other surface infrastructure is expected to be completed by early 2027. This is an important catalyst to increase underground mining rates to 2,400 tons per day in 2027 and ultimately 3,000 tons per day in 2029. Over to slide ten. In February, we announced the results of the larger Island Gold District expansion study.

Speaker #1: Growth capital for the phase three plus shaft expansion has been largely all spent or committed. Shaft sinking to a planned depth of 1,381 meters was completed in the first quarter, and pace plant construction is on track for completion in the second quarter.

Speaker #1: Commissioning of the shaft and other surface infrastructure is expected to be completed by early 2027. This is an important catalyst to increase underground mining rates to 2,400 tons per day in 2027, and ultimately 3,000 tons per day in 2029.

Speaker #1: Over to Slide 10. In February, we announced the results of the larger Island Gold District expansion study. The study included an expansion of the Magino mill to 20,000 tons per day, accelerated underground development to support mining rates of 3,000 tons per day, and other infrastructure investments.

Luc Guimond: The study included an expansion of the Magino Mill to 20,000 tons per day, accelerated underground development to support mining rates of 3,000 tons per day, and other infrastructure investments. The larger expansion is well underway with 11% of the growth capital spent or committed, primarily related to the expansion of the Magino Mill to 20,000 tons per day. As shown on the slide, construction of the mill building is well advanced, including structural steel, exterior cladding, and all eight leach tanks erected. With all the earthworks, concrete foundations, and steel erected, the key elements of the larger expansions have been significantly de-risked. The expansion remains on track for completion in early 2028 and will be a game changer for the operation.

Speaker #1: The larger expansion is well underway with 11% of the growth capital spent or committed. Primarily related to the expansion of the Magino mill to 20,000 tons per day.

Speaker #1: As shown on the slide, construction of the mill building is well advanced, including structural steel and exterior cladding, and all eight leach tanks erected.

Speaker #1: With all the earthworks, concrete foundations, and steel erected, the key elements of the larger expansions have been significantly de-risked. The expansion remains on track for completion in early 2028 and will be a game changer for the operation.

Speaker #1: With production expected to increase to average 534,000 ounces per year, at 1,025 per ounce all-in sustaining costs starting in 2028. The Island Gold District is expected to evolve into one of Canada's largest lowest cost and most profitable gold mines.

Luc Guimond: With production expected to increase to average 534,000 ounces per year at $1,025 per ounce all-in sustaining costs starting in 2028. The Island Gold District is expected to evolve into one of Canada's largest, lowest cost, and most profitable gold mines. Over to slide eleven. Young-Davidson produced 30,000 ounces in Q1, lower than planned, primarily due to lower mining and milling rates. Milling rates of 6,800 tons per day were below guidance, reflecting longer than anticipated downtime to complete scheduled maintenance, as well as an unscheduled repair to a transformer in the mill. Underground mining rates were also 5% lower than planned due to longer than expected timeline to complete rehabilitation work on one of the three ore passes, as well as delays in commissioning a newly constructed pass.

Speaker #1: Over to Slide 11. Young Davidson produced 30,000 ounces in the first quarter, lower than plan, primarily due to lower mining and milling rates. Milling rates of 6,800 tons per day were below guidance, reflecting longer than anticipated downtime, to complete scheduled maintenance, as well as an unscheduled repair due to transformer in the mill.

Speaker #1: Underground mining rates were also 5% lower than planned, due to a longer than expected timeline to complete rehabilitation work on one of the three ore passes, as well as delays in commissioning a newly constructed pass.

Speaker #1: This resulted in more re-handling of ore, reducing productivity during the quarter. With two passes now fully operational, the total number of active ore passes has increased to four.

Luc Guimond: This resulted in more rehandling of ore, reducing productivity during the quarter. With two passes now fully operational, the total number of active ore passes has increased to four. This is expected to provide greater operational flexibility and support increased mining and milling rates of approximately 8,000 tons per day in Q2 and through the remainder of the year. Mine grades were also below the low end of annual guidance, reflecting higher than planned mining dilution. Grades are expected to return to guided levels in Q2 and, combined with higher milling rates, we expect a substantial improvement in both production and costs through the rest of the year. Young-Davidson continues to deliver strong mine site free cash flow with $72 million generated in Q1.

Speaker #1: This is expected to provide greater operational flexibility and support increased mining and milling rates of approximately 8,000 tons per day, in the second quarter and through the remainder of the year.

Speaker #1: Mine grades were also below the low end of annual guidance, reflecting higher than planned mining dilution. Grades are expected to return to guided levels in the second quarter and, combined with higher milling rates, we expect a substantial improvement in both production and costs through the rest of the year.

Speaker #1: Young-Davidson continues to deliver strong mine site free cash flow, with $72 million generated in the first quarter. At current gold prices, higher production and lower costs are expected to drive further free cash flow growth through the rest of the year.

Luc Guimond: At current gold prices, higher production and lower costs are expected to drive further free cash flow growth through the rest of the year. Over to slide 12. Production from the Mulatos District totaled 32,700 ounces, including nearly 27,000 ounces from the La Yaqui Grande. Costs were at the low end of annual guidance, reflecting the higher grade stopes. Grade stopes are expected to decrease in Q2 and Q3 towards the lower end of guidance, and costs increase through the remainder of the year to be consistent with annual guidance. The Mulatos District generated strong mine site free cash flow of $61 million while funding the construction of the Cerro Pelon project, a robust exploration program, and paying $51 million in cash taxes during the quarter. Over to slide 13. Construction activities on the Cerro Pelon project are well underway.

Speaker #1: Over to Slide 12. Production from the Lattice District totaled 32,700 ounces, including nearly 27,000 ounces from the Yachty Grande. Costs were at the low end of annual guidance, reflecting the higher grade stack.

Speaker #1: Grade stacked are expected to decrease in the second and third quarters towards the lower end of guidance, and costs increased through the remainder of the year to be consistent with annual guidance.

Speaker #1: The Lattice District generated strong mine site free cash flow of 61 million. While funding the construction of the PDA project robust exploration program and paying 51 million in cash taxes during the quarter.

Speaker #1: Over to Slide 13. Construction activities on the PDA project are well underway. Earthworks on key surface infrastructure is now substantially complete. The mill foundation work is progressing, and last week we called it the portals and will continue underground development through the rest of the year.

Luc Guimond: Earthworks on key surface infrastructure is now substantially complete. The mill foundation work is progressing. Last week, we cut out the portals and will continue underground development through the rest of the year. The PDA project remains on budget and on schedule for first production in mid-2027. PDA is the future of the Mulatos operation. Based on the PDA deposit alone, this is a low cost, high return project which will extend the Mulatos mine life by at least 9 years. We believe this is just the starting point as the operation transitions to processing higher grade sulfide mineralization and expect there's a significant upside to come. The addition of a mill for PDA is opening up a number of new opportunities for additional higher grade mineralization within the district, such as Cerro Pelón and Halcón, where we are continuing to see strong ongoing exploration results.

Speaker #1: The PDA project remains on budget and on schedule for first production in mid-2027. PDA is the future of the Melotus operation. Based on the PDA deposit alone, this is a low-cost, high-return project which will extend the Melotus mine life by at least nine years.

Speaker #1: We believe this is just the starting point as the operation transitions to processing higher-grade sulfide mineralization and expect there is a significant upside to come.

Speaker #1: The addition of a mill for PDA is opening up a number of new opportunities for additional higher-grade mineralization within the district, such as Sarah Pallone and Hall Cone.

Speaker #1: Where we are continuing to see strong ongoing exploration results. With that, I will turn the call back to John.

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

Speaker #2: Thank you, Luke. I'll now turn the call over to the operator who will open the line for your questions.

John McCluskey: Thank you, Luc. I'll now turn the call over to the operator who will open the line for your questions.

Speaker #3: Thank you. If you have a question, please press star one on your telephone keypad to raise your hand and join the queue. If you wish to remove yourself from the queue, simply press star one again.

Operator 2: Thank you. If you have a question, please press star one on your telephone keypad to raise your hand and join the queue. If you wish to remove yourself from the queue, simply press star one again. One moment please for your first question. Your first question comes from the line of Ovais Habib of Scotiabank. Your line is open.

Operator: Thank you. If you have a question, please press star one on your telephone keypad to raise your hand and join the queue. If you wish to remove yourself from the queue, simply press star one again. One moment please for your first question. Your first question comes from the line of Ovais Habib of Scotiabank. Your line is open.

Speaker #3: One moment, please, for your first question. Your first question comes from a line of Ove Habib of Scotiabank. Your line is open.

Speaker #4: Thanks, operator. Hi, John and Alamos team. Just a couple of questions from me. My first question is on Island Gold. Really great to see mining rates averaging 1,400 tons per day.

Ovais Habib: Thanks, operator. Hi, John and Alamos team. Just a couple of questions from me. My first question is on Island Gold. Really great to see mining rates averaging 1,400 tons per day, and those are expected to grow over the next couple quarters, so looking forward to that. In regards to the area which you had the seismic issue, how much more work is required to completely rehabilitate that area? Second part of that is, do you need this area to achieve the 2,000 tons per day that you're targeting by the end of the year?

Speaker #4: And those are expected to grow over the next couple of quarters, so looking forward to that. In regards to the area which you had the seismic issue, how much more work is required to complete the rehabilitate that area?

Speaker #4: And second part of that is, do you need this area to achieve the 2,000 tons per day that you're targeting by the end of the year?

Speaker #2: Hi, Ove. It's Luke here. Yeah, with regards to the Island Gold mining front, where we had to reestablish the escape way, we completed that at the beginning of the year.

Scott Parsons: Hi, Ovais. It's Luc here. With regards to the Island Gold mining front that we had to reestablish the escape way, we completed that at the beginning of the year. The escape way is being reestablished, so that allows us to actually continue mining in that area. As far as the overall ramp up for this year in 2026 with what we're expecting, there's not a lot of production actually coming out of that area. We will see some production starting in H2. We're just continuing with some minor rehabilitation in this area since we've completed the escape way, which allows us to continue activities in that region, but not critical to the overall ramp up for 2026 and as we move into 2027.

Luc Guimond: Hi, Ovais. It's Luc here. With regards to the Island Gold mining front that we had to reestablish the escape way, we completed that at the beginning of the year. The escape way is being reestablished, so that allows us to actually continue mining in that area. As far as the overall ramp up for this year in 2026 with what we're expecting, there's not a lot of production actually coming out of that area. We will see some production starting in H2. We're just continuing with some minor rehabilitation in this area since we've completed the escape way, which allows us to continue activities in that region, but not critical to the overall ramp up for 2026 and as we move into 2027.

Speaker #2: So the escape way is being reestablished so that allows us to actually continue mining in that area. But as far as the overall ramp-up for this year in 2026 with what we're expecting, there's not a lot of production actually coming out of that area.

Speaker #2: So we will see some production starting in the second half of the year. And we're just continuing with some minor rehabilitation in this area since we've completed the escape way, which allows us to continue activities in that region.

Speaker #2: But not critical to the overall ramp-up for 2026 and as we move into 2027.

Speaker #4: Good stuff. Thanks for that, Luke. And then just moving to YD, good to hear mining rates are expected to now increase to average around 8,000 tons per day kind of Q2 onwards.

Ovais Habib: Good stuff. Thanks for that color, Luc. Just moving to YD. Good to hear mining rates are expected to now increase to average around 8,000 tons per day, kind of Q2 onwards, as both ore passes now for the operation. In regards to underground grades, they got hit in Q1 due to some mining dilution. How should we look at grades going to Q2 and then kind of in H2?

Speaker #4: As both ore passes are now fully operation, in regards to underground grades, they got hit in Q1 due to some mining delays in. How should we look at grades into Q2 and then kind of in the second half?

Speaker #2: Yeah, as I mentioned, on the read, the issue that we had with Q1 was certainly some dilution from a couple of stills. But as we move in through the rest of the year, we expect to be within our guidance of that 1.9 to 2.05 grades from underground.

Scott Parsons: Yeah, as I mentioned, on the read, the issue that we had with Q1 was certainly some dilution from a couple of stops. As we move into the rest of the year, we expect to be within our guidance of that 1.9 to 2.05 grades from underground. We're on track as we move forward through certainly into Q2 and as we follow the rest of the mine plan for the rest of the year.

Luc Guimond: Yeah, as I mentioned, on the read, the issue that we had with Q1 was certainly some dilution from a couple of stops. As we move into the rest of the year, we expect to be within our guidance of that 1.9 to 2.05 grades from underground. We're on track as we move forward through certainly into Q2 and as we follow the rest of the mine plan for the rest of the year.

Speaker #2: And we're on track as we move forward through certainly into Q2 and as we follow the rest of the mine plan for the rest of the year.

Speaker #4: So grades should be kind of around that 2 gram per ton, then kind of going into Q2?

Ovais Habib: Grades should be kind of around that 2 gram per ton then, kind of going into Q2?

Scott Parsons: Yeah. Within our guidance that we provided, which was, you know, between 1.9 and 205.

Luc Guimond: Yeah. Within our guidance that we provided, which was, you know, between 1.9 and 205.

Speaker #2: Yeah, within our guidance that we provided, which was between 1.9 and 205.

Speaker #4: Perfect. Okay. And then just moving on to exploration, and maybe this question is for Scott. Can you give us just kind of a brief overview of where you are currently focused on?

Ovais Habib: Perfect. Okay. Just moving on to exploration, and maybe this question is for Scott. Can you give us just kind of a brief overview where you are currently focused on, and especially if you continue to have any sort of success at Cline-Pick?

Speaker #4: And especially if you continue to have any sort of success at client picking.

Speaker #5: Yeah, absolutely. Our 2026 exploration programs are well underway across the board at all sites. We're just concluding a starting with Wind Lake, just concluding a program there focused on testing underground potential below the McLellan and Gordon deposits.

Scott Parsons: Yeah, absolutely. Our 2026 exploration programs are well underway across the board at all sites. We're just concluding a program there focused on testing underground potential below the MacLellan and Gordon deposits. That was executed on time just in time for spring breakup. Hopping over to Island Gold, the focus there is on continued expansion of Island Gold deposits. We're drilling from surface, focused on extending mineralization to the east and to the west, and then also at depth below the bottom of the reserves and resources. That program is well underway. The other aspect, as you mentioned, was Cline-Pick.

Speaker #5: And that was executed on time just in time for spring breakup, hopping over to Island Gold. The focus there is on continued expansion of Island Gold deposits.

Speaker #5: So we're drilling from surface, extending focus on extending mineralization to the east end of the west and then also at depth below the bottom of the reserves and resources and that program is well underway.

Speaker #5: The other aspect, as you mentioned, was client pick. We're drilling there and excited in what we're seeing as we follow up on the some of the results that we had issued earlier in the quarter and really looking at some of the controls on mineralization in that system and testing it down plunge and in and around existing mine workings with the intention of having a resource estimate by the end of 2026.

Scott Parsons: We're drilling there and, you know, excited in what we're seeing as we follow up on some of the results that we had issued earlier in the quarter. You know, really looking at some of the controls on mineralization in that system and testing it down plunge and in and around existing mine workings with the intention of having a resource estimate by the end of 2026. That's well underway as well. Hopping over to Young-Davidson, the underground program's focused on continuing to define the hanging wall zones that we had really put out some released results on earlier in the quarter. Both the Mid-Mine conglomerate zone and the South Cyanide zone.

Speaker #5: So that's well underway as well. Hopping over to Young Davidson, the underground programs focused on continuing to define the hanging wall zones that we had put out some results on earlier in the quarter.

Speaker #5: So both the mid-mine conglomerate zone and the South Sinai zone, and that program is well underway. As well as testing from surface some of the regional targets.

Scott Parsons: That program is well underway, as well as testing from surface some of the regional targets. Looking at, we completed a program at Otisse NE, which is the potential opportunity for additional open pit material. We can define a resource there, and that was successful in terms of that program, as well as some of the other regional targets in the district. Mulatos, that program's well underway. We're really focused off the start of the year at Halcon and Cerro Pelón. We're excited about what we're seeing at Cerro Pelón.

Speaker #5: So looking at we completed a program at Otis Northeast, which is the potential opportunity for additional open pit material if we can define a resource there.

Speaker #5: And that was successful in terms of that program. As well as some of the other regional targets in the district. And then Mulatto's, that program is well underway.

Speaker #5: We're really focused off the start of the year at Hall Cone and Sierra Palone. We're excited about what we're seeing at Sierra Palone and I think with the 200,000 ounces we've defined there by the end of 2025.

Scott Parsons: I think with the 200,000 ounces we've defined there by the end of 2025, I think that'll be just a starting point for that target as we continue stepping out on that sulfide mineralization, both in and around the pods we've defined, but also within the broader Cerro Pelón region. Halcon as well. It's a new discovery in 2025, and we're still defining the extent of that system. That's an exciting opportunity as well for additional sulfide mineralization in the Mulatos District. The last point I'll make, we're currently ramping up for our Qiqavik program, which is our project in Nunavik in northern Quebec, and that'll be underway later in Q2.

Speaker #5: I think that'll be just a starting point for that target as we continue stepping out on that sulfide mineralization. Both in and around the pods we've defined, but also within the broader Sierra Palone region.

Speaker #5: And Hall Cone as well, the new discovery in 2025, and we're still defining the extent of that system. That's an exciting opportunity as well for additional sulfide mineralization in the Mulatto's district.

Speaker #5: And then the last point I'll make where currently wrapping up for our Kiekevik program, which is our project in Nunavik in northern Quebec, and that'll be underway later in the second quarter.

Speaker #4: Good stuff, Scott. There's a lot going on. Looking forward to some results from these programs. That's it from me, guys. Again, looking forward to Q2.

Ovais Habib: Good stuff, Scott. There's a lot going on. Looking forward to some results from these programs. That's it from me, guys. Again, looking forward to Q2 for improvement in production and costs, and then looking forward to the site trip in summer as well. Thanks.

Speaker #4: For improvement in production and cost. And then looking forward to the site trip in summer as well. Thanks.

Speaker #6: Your next question comes from the line of Fahad Tariq of Jefferies. The line is open.

Operator 2: Your next question comes from the line of Fahad Tariq of Jefferies. Your line is open.

Operator: Your next question comes from the line of Fahad Tariq of Jefferies. Your line is open.

Speaker #7: Hi, thanks for taking my question. There was a comment in the press release talking about managing cost pressures with productivity improvements. Can you talk about what specific productivity improvements there are across the portfolio?

Fahad Tariq: Hi. Thanks for taking my question. There was a comment in the press release talking about managing cost pressures with productivity improvements. Can you talk about what specific productivity improvements there are across the portfolio?

Speaker #2: Yeah, Fahad, it's Greg here. That's referencing what we've already identified as part of our plan in 2026 and even moving into 2027. But, I mean, the critical thing is obviously ramping up our mining rates at Island Gold from 1,400 tons per day, which we achieved in Q1, up to 2,000 tons per day by the end of the year.

Greg Fisher: Yeah, Fahad, it's Greg here. That's referencing what we've already identified as part of our plan in 2026 and even moving into 2027. I mean, the critical thing is obviously ramping up our mining rates at Island Gold from 1,400 tons per day, which we achieved in Q1, up to 2,000 tons per day by the end of the year. As we increase our production from the underground at Island, that is critical for us 'cause it's our lowest cost structure that we have across our portfolio. That's obviously a focus. The other piece would be ramping up the Magino Mill.

Speaker #2: And as we increase our production from the underground at Island, that is critical for us because it's our lowest cost structure that we have across our portfolio.

Speaker #2: So that's obviously a focus the other piece would be ramping up the Magino mill from 7,500 tons per day in Q1 to closer to 10,000 tons through at least the second half of the year.

Greg Fisher: You know, from 7,500 tons per day in Q1 to closer to 10,000 tons through at least H2 of the year. That's obviously gonna bring down our cost structure in H2 of the year. Then the last would be the mining rates at Young-Davidson getting back up to 8,000 tons per day. All of those things are items that are going to manage those cost pressures in 2026. Then as we move into 2027, there's obviously moving from ramp mining to shaft mining or haul skipping up the shaft is gonna have a significant impact on our cost structure moving forward.

Speaker #2: That's obviously going to bring down our cost structure in the second half of the year. And then the last would be the mining rates at Young Davidson getting back up to 8,000 tons per day.

Speaker #2: So all of those things are items that are going to manage those cost pressures in 2026. And then as we move into 2027, obviously moving from ramp mining to shaft mining, or skipping up the shaft, is going to have a significant impact on our cost structure moving forward.

Speaker #2: And then the last is the hooking up the grid power at the Magino mill. And that's something that we'll have we plan to have in place by early 2027 as well.

Greg Fisher: The last is the hooking up to grid power at the Magino Mill, and that's something that we'll have, we plan to have in place by early 2027 as well. All of those are things that we outlined previously, but they go a long way to managing any inflationary pressures that we're seeing.

Speaker #2: So all of those are things that we've outlined previously. But they go a long way to managing any inflationary pressures that we're seeing.

Speaker #7: Okay, great. And then maybe just to follow up on that, can you just talk about what pressures you're seeing? I think, I guess, April 1st onwards in terms of diesel, I think the press release even talked about labor, which might be like a second or third order effect.

Fahad Tariq: Okay, great. Then maybe just to follow up on that, can you just talk about what pressures you're seeing, I think, I guess, 1 April onwards in terms of diesel? I think the press release even talked about labor, which might be like a second or third order effect, but just what you're seeing across the board on cost inflation.

Speaker #7: But just what you're seeing across the board on cost inflation.

Speaker #2: Yeah, and you highlighted the two kind of primary ones. So diesel obviously, that's the cost pressure that the entire industry is seeing. We're fortunate in that diesel isn't a big part of our cost structure.

Greg Fisher: Yeah. You highlighted the two kind of primary ones. Diesel, obviously that's a cost pressure that the entire industry is seeing. We're fortunate in that diesel isn't a big part of our cost structure. It's about 5%. If you break it down, about two-thirds of that is in Canada and one-third in Mexico. In Mexico, it's a regulated system, so you don't see the same effects of the higher diesel price in Mexico that we do in Canada. Then in Canada, it's about 20% of our diesel has been hedged at much lower rates than what we're seeing right now.

Speaker #2: It's about 5%. And if you break it down, about two-thirds of that is in Canada and one-third in Mexico. And in Mexico, it's a regulated system.

Speaker #2: So you don't see the same effects of the higher diesel price in Mexico that we do in Canada. And then in Canada, it's about 20% of our diesel has been hedged at much lower rates than what we're seeing right now.

Speaker #2: So all to say very manageable because it's a small component of our cost structure and it being less than 5%. On labor, I'd say that the bigger pressure is more on contractor labor.

Greg Fisher: All to say, very manageable 'cause it's a small component of our cost structure and it being less than 5%. On labor, I'd say that the bigger pressure is more on contractor labor. You know, we have put in place our increases for the year, all very manageable, all built into our budget. What we're seeing a little bit of is pressure from contractors to make sure that they can fill their roles and some increased cost there. But again, something that is manageable based on our cost guidance that we have for the rest of the year.

Speaker #2: We have put in place our increases for the year all very manageable, all built into our budget. What we're seeing a little bit of is pressure from contractors to make sure that they can fill their roles and some increased cost there.

Speaker #2: But again, something that is manageable based on our cost guidance that we have for the rest of the year.

Speaker #7: Got it. Thank you so much.

Fahad Tariq: Got it. Thank you so much.

Speaker #6: Your next question comes from the line of Ralph Profiti of Stifel. Your line is open.

Operator 2: Your next question comes from the line of Ralph Profiti of Stifel. Your line is open.

Operator: Your next question comes from the line of Ralph Profiti of Stifel. Your line is open.

Speaker #4: Yes, thanks very much. My question is firstly on Young Davidson. And within the context of this strong recovery that we're going to see through 2026, there is some discussion around Stopover Break leading to a review of the blasting design.

Ralph Profiti: Yes, thanks very much. My question is, firstly on Young-Davidson and within the context of this strong recovery that we're gonna see through 2026. There is some discussion around stope overbreak leading to a review of the blasting design. Just wondering, is this something new that we're dealing with? Was this identified as a risk when we encountered some of the headwinds in the back half of 2025? Just wondering, you know, is the blasting review part of sort of just where we're having these stope overbreak issues, or is this part of a broader, you know, all stope encompassing plan?

Speaker #4: And just wondering, is this something new that we're dealing with? Was this identified as a risk when we encountered some of the headwinds in the back half of '25?

Speaker #4: Just wondering is the blasting review part of sort of just where we're having these Stopover Break issues? Or is this part of a broader all-stop encompassing plan?

Speaker #2: Yeah, hi, it's Luke here. I mean, the drilling and blasting review is always an ongoing process with regards to the mining, I guess, closeout of the reconciliation of each of our stops.

Luc Guimond: Yeah. Hi, it's Luc here. I mean, the drilling and blasting review is always an ongoing process with regards to the mining, I guess, close out of the reconciliation of each of our stopes. This is nothing new. We continue to review that on an ongoing basis. I mean, historically, the performance has been good at Young-Davidson, but we've been mining there now for the better part of 13 years. Actual results from a grade perspective usually reconcile quite well to the model, and we've got a good history of that.

Speaker #2: So this is nothing new. We continue to review that on an ongoing basis. I mean, and historically, the performance has been good at Young Davidson.

Speaker #2: I mean, we've been mining there now for the better part of 13 years. And actual results from a great perspective usually reconcile quite well to the model.

Speaker #2: And we've got a good history of that in this specific quarter. We did have a couple of stops that underperformed from a dilution aspect where we typically model around 10 to 12 percent dilution.

Luc Guimond: In this specific quarter, we did have a couple stopes that underperformed from a dilution aspect, where we typically model around, you know, 10 to 12% dilution, and we had some higher dilution on the basis of a couple of stopes that we mined in the quarter. Really, the process of closing out the reconciliation is also looking at the drilling and blasting design and seeing if there's some improvements there based on that reconciliation to any modifications that we may need to make. It could be specific to certain regions, maybe some geological structures within those regions that are adding to the dilution. You know, maybe we need to change our drill and blasting patterns as a result of that.

Speaker #2: And we had some higher dilution on the basis of a couple of stops that we mined in the quarter. But really, the process of closing out the reconciliation is also looking at the drilling and blasting design and seeing if there's some improvements there based on that reconciliation to any modifications that we may need to make.

Speaker #2: And it could be specific to certain regions, maybe some geological structures within those regions that are adding to the dilution. And maybe we need to change our drill and blasting patterns as a result of that.

Speaker #2: So we take all that into consideration. And basically, do a full analysis and part of it is certainly the drill and blast design as well.

Luc Guimond: We take all that into consideration and basically do a full analysis. Part of it is certainly the drill and blast design as well.

Speaker #7: Gotcha. Okay. And just as a sort of a minor follow-up, as it stands right now, do you envision the supplementary temporary crushing at Magino to be in place until the 20,000-ton-per-day expansion is commissioned?

Ralph Profiti: Gotcha. Okay. Just as a sort of a minor follow-up, you know, as it stands right now, do you envision the supplementary temporary crushing at Magino to be in place until the 20,000 tons per day expansion is commissioned? Does the existing secondary crusher, once it is optimized, sort of get you to meet the plan? Do you envision sort of weaning off the temporary?

Speaker #7: Or does the existing secondary crusher once it's optimized sort of get you to meet the plan? Or do you envision sort of weaning off the temporary?

Speaker #2: Yeah, we've currently still have it in place. I mean, we commissioned that mid-February. And really, initially, it was to help us to get through certainly through the winter conditions, some of the challenges that we have operating in the winter.

Luc Guimond: Yeah, we currently still have it in place. I mean, we commissioned that mid-February, and really initially it was to help us to get through, you know, certainly through the winter conditions. Some of the challenges that we have operating in the winter, it provided consistency for more supplemental feed into the mill grinding circuit. We still have it in place currently, but I would say we would rely less on it through the summer months than we need to do in the winter months. When we do have scheduled maintenance, it allows us to continue to provide, you know, if we have scheduled maintenance on the crushing circuit, it allows us to continue to provide mill feed into the grinding circuit. That's the advantage of it.

Speaker #2: It provided consistency for more supplemental feed into the mill grinding circuit. So we still have it in place currently. But I would say we would rely less on it through the summer months than we need to do in the winter months.

Speaker #2: But when we do have scheduled maintenance, it allows us to continue to provide if we have scheduled maintenance on the crushing circuit, it allows us to continue to provide mill feed into the grinding circuit.

Speaker #2: So that's the advantage of it. So periodically, it will get used to continue to get used through the summer months as well. But keep in mind, and I think we've discussed this, is once we do complete that larger mill expansion to 20,000 tons per day, we are going to change some of that crushing circuit and primarily adding a gyratory crusher will eliminate some of the winter challenges that we had certainly with regards to the front end of that crushing circuit that we currently operate with.

Luc Guimond: You know, periodically it will get used, continue to get used through the summer months as well. Keep in mind, and I think we've discussed this, is once we do complete that larger mill expansion to 20,000 tons per day, we are gonna change some of that crushing circuit. Primarily adding a Gyratory crusher will, you know, eliminate some of the winter challenges that we had, certainly with regards to the front end of that crushing circuit that we currently operate with. Come 2028, certainly we would not require that. Periodically, we will continue to use it. Yes.

Speaker #2: So come 2028, certainly, we would not require that. But periodically, we will continue to use it, yes.

Speaker #7: Okay. Yeah, helpful answers. Thanks very much.

Ralph Profiti: Okay. Yeah. Helpful answers. Thanks very much.

Speaker #6: Your next question comes from the line of Don Demarco of National Bank. Your line is open.

Operator 2: Your next question comes from the line of Don DeMarco of National Bank. Your line is open.

Operator: Your next question comes from the line of Don DeMarco of National Bank. Your line is open.

Don DeMarco: Thanks, operator, and good morning, John and team. Great to see the growth trajectory affirmed. First question, going back to the discussion on diesel. You know, we see that costs are expected to decrease by 5% in Q2. Does this assume that diesel prices remain flat?

Speaker #4: Thanks, Brader. And good morning, John and team. Great to see the growth trajectory affirmed. First question, going back to the discussion on diesel, we see the costs are expected to decrease by 5% in Q2.

Speaker #4: Does this assume that diesel prices remain flat?

Speaker #2: Correct. It's based on the spot prices that were in place at March 31st. So the higher rates that we're seeing now is what we've assumed when we talked about that 5% reduction in cost.

Greg Fisher: Correct. It's based on the spot prices that were in place at 31 March. The higher rates that we're seeing now is what we've assumed when we talked about that 5% reduction in cost.

Speaker #4: Okay. And as Luke was mentioning, the island mining rates continue higher in Q1 on their way to 2,000 by the end of the year.

Don DeMarco: Okay. As Luc was mentioning, the Island mining rates continue higher in Q1 on their way to 2000 by the end of the year. Are you stockpiling this or the delta between the nameplate at Island Gold, or are you putting it through the Magino Mill?

Speaker #4: Are you stockpiling this or the delta between the nameplated island gold? Or are you putting it through the Magino mill?

Speaker #2: Yeah, no stockpiling that's occurring there, Don. I mean, the additional tons that come up from island underground outside of what can be milled at the island mill itself end up over at the Magino mill.

Luc Guimond: Yeah, no, no stockpiling that's occurring there, Don. I mean, the additional tons that come up from Island underground, outside of what can be milled at the Island Mill itself, end up over at the Magino Mill, and we process it through the Magino Mill. We'll continue that as we move through certainly the rest of the year with the ramp-up. Any additional-

Greg Fisher: Yeah, no, no stockpiling that's occurring there, Don. I mean, the additional tons that come up from Island underground, outside of what can be milled at the Island Mill itself, end up over at the Magino Mill, and we process it through the Magino Mill. We'll continue that as we move through certainly the rest of the year with the ramp-up. Any additional-

Speaker #2: And we process it through the Magino mill. And we'll continue that as we move through the certainly the rest of the year. With the ramp-up, any additional tons that cannot be fed into the island mill will go into the Magino mill.

Luc Guimond: Okay.

Luc Guimond: Tons that cannot be fed into the Island Mill will go into the Magino Mill.

Speaker #4: Okay. And then finally, do you plan to continue to settle the legacy Argonaut hedges each quarter? And are you looking at it more tactically?

Don DeMarco: Okay. Then finally, do you plan to continue to settle the legacy Argonaut hedges each quarter? Are you looking at it more tactically or kind of are you thinking maybe the same amount that we saw in Q1 each quarter going forward?

Speaker #4: Or are you thinking maybe the same amount that we saw in Q1 each quarter going forward?

Greg Fisher: I think we'll be opportunistic based on where we see the gold price going. I think we've been tactical all along in taking out 200-

Speaker #2: I think we'll be opportunistic based on where we see the gold price going. So I think we've been tactical all along in taking out 200 close to 250,000 out of the 330,000 ounces that we originally inherited.

Greg Fisher: I think we'll be opportunistic based on where we see the gold price going. I think we've been tactical all along in taking out 200-

Greg Fisher: Yeah.

Don DeMarco: Yeah.

Greg Fisher: Close to 250,000 out of the 330,000 ounces that we originally inherited. We'll look to continue to doing that as we approach the remaining 85,000 ounces.

Speaker #2: And we'll look to continue to doing that as we approach the remaining 85,000 ounces.

Speaker #4: Okay. Great. Thanks, Greg. That's all from me. Good luck with Q2.

Don DeMarco: Okay, great. Thanks, Greg. That's all for me. Good luck with Q2.

Speaker #6: Your next question comes from the line of Lauren McConnell of Paradigm Capital. Your line is open.

Operator 2: Your next question comes from the line of Lauren McConnell of Paradigm Capital. Your line is open.

Operator: Your next question comes from the line of Lauren McConnell of Paradigm Capital. Your line is open.

Speaker #8: Hi, good morning. Thanks, operator, and thanks, Alamos team, for taking our questions. Just on the Phase III+ expansion, it's good to see the shaft sink complete.

Lauren McConnell: Hi, good morning. Thanks, operator, and thanks Alamos team for taking our questions. Just on the Phase Three Plus expansion, it's good to see the shaft sink complete, you know, and 100% of the growth capital spent or committed, with commissioning expected, you know, early next year. What are sort of the remaining critical path items? Is it that paste plant that's, you know, currently on track for completion in Q2? And what are sort of the next sort of key milestones that we should continue to watch to make sure we keep seeing that on track for early 2027?

Speaker #8: And 100% of the growth capital spent or committed was commissioning expected early next year. What are sort of the main remaining critical path items?

Speaker #8: Is it that pace plant that's currently on track for completion in Q2? And what are sort of the next sort of key milestones that we should continue to watch to make sure we keep seeing that on track for early

Speaker #2: Yeah, it's Luke here. Things are tracking well with regards to the certainly the phase three plus expansion. I mean, the two critical items, I guess, right now, as you mentioned, we've completed all of the rockwork in the shaft.

Luc Guimond: Yeah, it's Luc here. Things are tracking well with regards to the, certainly the Phase Three Plus expansion. I mean, the two critical items, I guess, right now is, as you mentioned, we've completed all of the rock work in the shaft. So now we're actually furnishing the shaft. So we're putting all of the structural steel in the shaft, separating the compartments for skipping, you know, personnel travel and services. So that'll occur over the rest of this year. Timeline is that would be completed early in Q1 2027. The second component of that is away from the shaft, which is actually the ore and waste handling infrastructure that's required to be able to feed the shaft. We're well embarked on that as well.

Speaker #2: So now we're actually we're furnishing the shaft. So we're putting all of the structural steel in the shaft, separating the compartments for skipping, personnel travel, and services.

Speaker #2: So that'll occur over the rest of this year. The timeline is that would be completed early in the first quarter of 2027. And then the second component of that is away from the shaft, which is actually the ore and waste handling infrastructure that's required to be able to feed the shaft.

Speaker #2: We're well embarked on that as well. So we're in the process of doing some rockwork in relation to one of the bins, one of the large bins for the underground loading pocket.

Luc Guimond: We're in the process of doing some rock work in relation to one of the bins, one of the large bins for the underground loading pocket, and we'll be establishing our grizzly station as well as the loading pocket at 1,350. That work is also expected to be completed in early 2027 in Q1 as well. That will all kind of tie in together. I'd say by mid Q1, we should have the ore waste handling components commissioned as well as the shaft commissioned to be able to start utilizing the shaft for ore and waste movement and personnel movement as well.

Speaker #2: And we'll be establishing our grizzly station as well as the loading pocket at 1350. That work is also expected to be completed in early 2027 in the first quarter as well.

Speaker #2: So that will all kind of tie in together. So I'd say by mid-Q1, we should have the ore waste handling components commissioned as well as the shaft commissioned to be able to start utilizing the shaft for ore and waste movement and personnel movement as well.

Speaker #8: Okay. Great. That's really helpful. And then just on the overall larger expansion, I think that it said that about 11% of the growth capital has been spent or committed.

Rachel Smith: Okay, great. That's really helpful. Just on the overall, you know, larger expansion, I think that it said that about 11% of the growth capital has been spent or committed. Just wondering how much of that remaining, I think it was $542 million, is still exposed to sort of inflation and procurement risk and, you know, any kind of scope changes at this point.

Lauren McConnell: Okay, great. That's really helpful. Just on the overall, you know, larger expansion, I think that it said that about 11% of the growth capital has been spent or committed. Just wondering how much of that remaining, I think it was $542 million, is still exposed to sort of inflation and procurement risk and, you know, any kind of scope changes at this point.

Speaker #8: And so I'm just wondering how much of that remaining I think it was 542 million is still exposed to sort of inflation and procurement risk and any kind of scope changes at this point.

Speaker #2: Yeah. On that front, I mean, a bunch of that is development. So development is subject to labor inflation, basically. The other piece would be the kind of core components of the mill.

Greg Fisher: Yeah. On that front, I mean, a bunch of that is development. Development is subject to labor inflation, basically. The other piece would be the kinda core components of the mill. We've got contracts in place for some of that, but we're still working through contracts. Technically, there is some inflationary pressure there, although we're not hearing right now that we're expecting much from that. I'd say it would be normal course inflationary pressures of kind, 4% to 5%.

Speaker #2: And we've got contracts in place for some of that, but we're still working through contracts. So, technically, there is some inflationary pressure there, although we're not hearing right now that we're expecting much from that.

Speaker #2: So I'd say it would be normal course inflationary pressures of kind of 4 to 5 percent.

Rachel Smith: Okay, great. That's really helpful. That's it for me. Thanks, everyone.

Lauren McConnell: Okay, great. That's really helpful. That's it for me. Thanks, everyone.

Speaker #8: Okay. Great. That's really helpful. And that's it for me. Thanks, everyone.

Speaker #6: And your last question comes from the line of Satish Kazanathan of Bank of America. Your line is open. Satish, perhaps your line is on mute?

Operator 2: Your last question comes from the line of Lawson Winder of Bank of America. Your line is open. Satish, perhaps your line is on mute.

Operator: Your last question comes from the line of Lawson Winder of Bank of America. Your line is open. Satish, perhaps your line is on mute.

Lawson Winder: Yeah. Hi, good morning. Thanks for taking my questions. My first question is on capital allocation. We saw strong free cash flow generation in Q1, but there were no share buybacks. Given the free cash flow is expected to improve throughout the remainder of the year, what should we think about the potential for getting more active in buybacks?

Speaker #9: Yeah. Hi. Good morning. Thanks for taking my questions. My first question is on capital allocation. We saw strong free cash flow generation in the first quarter.

Sathish Kasinathan: Yeah. Hi, good morning. Thanks for taking my questions. My first question is on capital allocation. We saw strong free cash flow generation in Q1, but there were no share buybacks. Given the free cash flow is expected to improve throughout the remainder of the year, what should we think about the potential for getting more active in buybacks?

Speaker #9: But there were no share buybacks. Given the free cash flow is expected to improve throughout the remainder of the year, how should we think about the potential for getting more active in buybacks?

Speaker #2: Hi, Satish. This is John speaking. We've always taken a very opportunistic approach to share buybacks. And we had what do you call it? We had a focus in the first quarter on increasing the dividend and the buyback of we spent 45 million buying back part of the legacy Argonaut hedges.

John McCluskey: Hi, Lawson. This is John McCluskey speaking. We've always taken a very opportunistic approach to share buybacks. We had, what do you call it? We had a focus in the first quarter on increasing the dividend and the buyback of, we spent $45 million buying back part of the legacy Argonaut hedges. You know, you take an opportunity like you see now with our shares underperforming in the market. Probably a good guess would be that we're being opportunistic on that front. We expect to be more active with the share buyback in Q2 and for the remainder of the year.

Speaker #2: But you take an opportunity to, like you see now with our shares underperforming in the market, probably a good guess would be that we are being opportunistic on that front.

Speaker #2: We expect to be more active with the share buyback in Q2. And for the remainder of the year.

Lawson Winder: Okay. Yeah, thank you for the color. Most of my other questions have been asked and answered. Maybe one on Magino. You expect meaningful cost savings from connecting the Magino mill to the grid power. Can you maybe quantify the dollar per ounce impact once it is fully online?

Speaker #9: Okay. Yeah. Thank you for the color. And most of my other questions have been asked and answered. Maybe one on Maginot. So you expect meaningful cost savings from connecting the Maginot mill to the grid power.

Sathish Kasinathan: Okay. Yeah, thank you for the color. Most of my other questions have been asked and answered. Maybe one on Magino. You expect meaningful cost savings from connecting the Magino mill to the grid power. Can you maybe quantify the dollar per ounce impact once it is fully online?

Speaker #9: Can you maybe quantify the dollar per ounce impact once it is fully online?

Speaker #2: Yeah. It's about $5 a ton, correct? $5 a ton.

John McCluskey: Yeah. It is about $5 a ton. Correct? Yeah, it is $5 a ton.

Speaker #9: Okay. Thank you. Thanks for taking my question.

Lawson Winder: Okay. Thank you. Thanks for taking my question.

Sathish Kasinathan: Okay. Thank you. Thanks for taking my question.

Speaker #6: There are no further questions at this time. This concludes this morning's call. If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416-368-9932 at That is 416-368-9932, extension 5439.

Operator 2: There are no further questions at this time. This concludes this morning's call. If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416 368 9932 at extension 5439. That is 416 368 9932, extension 5439. This concludes today's conference call. You may now disconnect.

Operator: There are no further questions at this time. This concludes this morning's call. If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416 368 9932 at extension 5439. That is 416 368 9932, extension 5439. This concludes today's conference call. You may now disconnect.

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