Aura Minerals Q3 2024 Earnings Call Transcript

Quartr
Provided by Quartr
November 5, 2024

There are 6 speakers on the call.

Operator

Good morning, ladies and gentlemen. Welcome to Third Quarter 2024 Earnings Call. This conference is being recorded and a replay will be available at the company's website at auraminerals.com/investidores slash The presentation will also be available for download. This call is also available in Portuguese. To access, you can press the globe icon on the lower right side of your Zoom screen and then choose to enter the Portuguese room.

Operator

After that select mute original audio. We would like to inform that all attendees will only be listening to the conference during the presentation and then we will start the question and answer session when further instructions will be provided. Before proceeding, we would like to clarify that any statements that may be made during this conference call regarding the company's business prospects, operational and financial projections and goals are the beliefs and assumptions of Aura Executive Board and the current information available to the company. These statements may involve risks and uncertainties as they relate to future events and therefore depend on circumstances that may or may not occur. Investors should be aware of events related to the macroeconomic scenario, the industry and other factors that could cause results to differ materially from those expressed in their respective forward looking statements.

Operator

Present at this conference, we have Rodrigo Barbosa, President and CEO and Klebert Cardoso, the CFO. Now I'll turn the conference over to Rodrigo Barbosa. You may begin your conference.

Speaker 1

Thank you very much and good morning for all. It's a pleasure to be here again to talk about Q3 results. And as we will go through the presentation, all of us, we are super proud to share with the market the strong results that's coming with higher production, lower cost and higher gold prices. And as we will see throughout the presentation, for 2025, there's another project coming online that we will be able to continue to grow and deliver on stronger results along the next quarters. Just one second, okay.

Speaker 1

So as we already disclosed with the market a couple of weeks ago, we during the Q3, we produced 68.2 gold equivalent ounces when added to the other quarters on the last 12 months, record high production of 270,000 gold equivalent ounces in production on a yearly basis. This is on quarter 10% increase on Q3 compared to Q3 2023. And as we've been disclosing with the market, we would see this increase along the year. First, because we have fixed and increased production in Honduras that went through a challenging year last year. And on the top of that, also, Alma's coming online and also reaching a full production after the transition of the contractor.

Speaker 1

So when you add the stronger production for Honduras and then also Almas with a stable production and in Arras Azul despite some lower production in Apuena, we are reaching record high production. At the same time, we are very glad that we could manage. And as I was mentioning, we're managing the cost is our focus. ALMOS has a slower cash cost compared to the average that we have. So ALMOS coming online also can contribute to a lower all in sustaining cash costs.

Speaker 1

So the combination of higher production, higher gold prices and lower costs came to a record high EBITDA of $78,000,000 This is close to 40% above the previous quarter. And understanding that during the Q3, the average gold prices was $2,500 while today is above $2,700 Of course, during Q4, there will be some impact on the cash generation due to the colors that Kleber is going to present, but on EBITDA, this is going to be stronger and also there's some ounces that are not hedged that will benefit from a strong ounce of gold prices during Q4. And then during next year, we will also have some hedges, but that is less than 20% of the production. So also benefited from a higher gold price. So there's record high EBITDA of $78,000,000 that was translated to $65,000,000 on free cash flow to firm.

Speaker 1

Out of this $65,000,000 we invested $54,000,000 That means that we've been able to grow within our own cash flow from the operations. And despite investing in Borborema and other projects for growth, we've been able to also to reduce the net debt to EBITDA, which give us a very strong position to start production on Borborema next year already with under lower leverage that will contribute to a higher production and cash flow from operations. Borrema, that was mentioned, is already above 54% construction completed on time, on budget to start the ramp up during Q1 next year and then commercial production second semester next year, very much in line with our projections and now entering the very fast speed that we will disburse in advance in the project so that we can start the ramp up in Q1 next year. Trevor is going to also mention to you, if in one hand, we have a very strong and it's very good sign that gold price has been appreciated significantly until the end of Q3, although it continue to appreciate. This is stronger cash flow comes from this gold price.

Speaker 1

But also there is some adjustment account, I mean, non cash adjustments that we need to do to market to market the options that Kleber will also provide you more detail. So very strong Q3 and we should see Q4 continue to increase in terms of results. And then next year, Boroborema Online also adding more ounces and more EBITDA and more cash flows. As important, that strong results that we continue to move up dividend after Achium 3 closed, assessing capital markets on the debt capital markets. We just announced BRL 1,000,000,000 that was initially for cash to be BRL 5,000,000,000.

Speaker 1

We increased due to the significant demand to BRL 1,000,000,000 could reduce the cost. That shows how strong Aura has popularity and can access a good source of capital when it's necessary. On the top of that, we also announced an acquisition that we entered in the process of acquisition of 1 project in Guatemala that has a world class deposit that will take few years for us to be able to get approvals and licensing fully so that we can start investing. But we are very confident that we will be able to do so. And after closing, we will also dive in in the project, so then disclose more information about our strategy with the project.

Speaker 1

Also recently, yesterday, we announced a change in dividend policy, which we now pay on a quarterly basis. We were paying biannually. Now we're going to pay on a quarterly basis, reminding the investors that our policy is 20% of the EBITDA minus recurring CapEx, not including the expansion CapEx. But as you can notice during the last few years, we've been paying above the minimum above the guidance that we give. And now we also declared more dividends yesterday, which provide our investors annualized yield of 9.3% return on dividends and share buyback.

Speaker 1

If you see the other years, we also provided a return to our shareholders in 2022 by 6%, same thing in 2023 and 2021%, 13% and now 9.3% on the top of our growth. So we've been able to do what we disclosed to the market during our IPO in Brazil. We had the projects to grow, to invest in greenfield projects while we pay dividends and including also M and A. Since then, we acquired Borborema, we're now in the process of acquisition also for Bluestone and investing in Alma's and now paying the dividends and maintaining and also reducing our net debt to EBITDA. That is a very strong signals that Aura has a very strong cash flow coming from the operation, although we will continue to increase along the next year with the development of Borborema, Matopad and hopefully, Sejo Blanco in Borborema.

Speaker 1

So next slide. As we always disclose, safety is the most important value that we have and we monitor all the operations on the hourly basis and daily basis. That quarter, we had a zero lost time incident. Now we are at Araujo 24 months, Minosa 23 months and almost 26 months without any lost time incident. A Pueyno, we had unfortunately a minor lost time incident during Q2.

Speaker 1

And but if we're not that, we also would be around 24 months in our in Apoena without lost time incident. We also have a third party consultancy that monitor together. We have our own team, but also a consultant external party to monitor all the geotechnical structures and they also always issue a report about the stability of their structures and that we finished the quarter with all the geotechnical structures under satisfactory conditions. So when we look the production on the left chart on the line above the bars, as I was mentioning, since last year, we would see a gradual increase in the last 12 months production. And now we see that we had an increase in Q3, 2023, Q4, 2023, Q1, Q2 and Q3.

Speaker 1

2024 is the 5th quarter in the world that we've been increasing the last 12 months of production and that comes from the challenge that had been in Honduras and also now the production coming in full in Almas. When you move to the right side on the bars, we saw Arun Azul, they had minor decrease in gold equivalent ounces. That does because as we convert the production and the revenues in copper by gold equivalent, we divided by the price of gold. Gold price has appreciated more than copper price, so that means that it's less gold equivalent ounces produced. Although in terms of amount of copper, it would have increased by 8%.

Speaker 1

Our production in Osovarez Azul has been very stable and very much in line with our mine plan. Now Poena, this is where we had a reduction in production, very much triggered by a delay in some access that we would have to mine in Ozdiet. So we had to switch to other areas that had a lower grade and also lower recovery, but we should be entering that area very soon, either next quarter or next year. But we also should see an increase in production in Q4 compared to Q3 in Apoena, although not significant. In Minoza, again, we continue to do improvements on the operations, either stocking also on the recoveries, but also we had a favorable weather with less than average rain that allowed us to produce from 29,000 ounces to 21,000 during the quarter, which was very strong and also helped us to reduce the cost.

Speaker 1

Alma, as we were disclosing to the market, Q2, we had a unique partner once we had a transition in the contractor. We lost production mainly in April May. And as we showed and disclosed with the market in June, we were already producing close to 5,000 ounces per month. And we had realized we understood that now we were on track to meet a strong production in Q3 and then also in Q4. So now we are delivering this 15,000 ounces during the quarter, which is on average 5,000, which is the capacity for ALMOS during this year.

Speaker 1

So very strong, not only with the production, but also now stabilizing the costs. So that also helped us on ALMOS to bring the average slightly down. So as I mentioned in terms of cash costs, very important, while the industry has been increasing in all in sustaining cash costs due to very different factors, including inflation along the last 4, 5 quarters. All that we've been able to manage very closely and on the hourly basis, on the daily basis, our costs. So we've been seeing on Q4 last year, Q1, Q2, Q3, a very stable trend with a slight decrease now during Q3, and we should continue to see this stability in terms of cash costs for Q4 during this year.

Speaker 1

Next slide. So in terms of the guidance, we maintain the guidance that we initially projected to the market. We are now at 201,000 ounces of production. When you project us to the end of Q4, we should be very much in line with the guidance between $244,000,000 $292,000,000 perhaps in the middle or slightly above with a constant prices where we when we projected this to be above the average of the guidance in terms of production, reflecting strong production that's coming from operation despite some weaker production in Apuena. In terms of cash cost, we also could provide in the market on Q3 year to date, the cash cost now at $10.22 It would have been below $1,000 if we had the prices that we projected.

Speaker 1

The influence here of the gold prices is when you convert copper to gold, it's less gold equivalent. So you divide the cost by less production, so that increase a little bit the cash cost. So that's why we provide the investors and the analysts the two references. But despite higher cash costs, because of higher gold prices, which is a good news, we've been able to manage and we are now very much in line with the lower level of the guidance we gave to the market. That also reflect was reflected to Huawei in sustaining cash cost.

Speaker 1

That is now at the $1300 would be below $1300 at constant prices, which is very much with the bottom range of 2024 guidance. And we see no reason for that trend to change during Q4. In terms of CapEx, that's we are now have $114,000,000 until September, projection or the guidance for the market is $188,000,000 to $219,000,000 Understanding that now is Burborema just entered the phase of high expenses and high speed of construction. So we maintain the guidance to the market also for the year end in terms of CapEx. And Burborema very much in line with the schedule and also with the budget.

Speaker 1

Talking about Por Boerema, that's the picture on the left. Things are now coming together. We are as you see in the picture, we build the parts around the main plant and then once those parts are get ready, we assemble them and now we are just entering the phase of assembling all the parts into the main plant and this picture should evolve significantly along the next couple of weeks. Again, we'll always like to highlight the importance and the relevance of this project within our portfolio. This is a project that was initially projected with 812,000 ounces, although we have 2,000,000 ounces of resources.

Speaker 1

We utilize only 812,000 ounces as a reserve because of restriction of one area that we would only access if our road would be moved. Only with this 812,000 ounces of reserves, this project at the gold price of 2,600 is already generating an NPV close to $540,000,000 and also internal rate of return above 81%. Understanding that this project after we can license to move the road, the reserves can more than double and then we also access a significant higher NPV. And this NPV was calculated without the impacts of the collars that we did for the 1st 3 years, even to understand how relevant it is or not so significant is the impact of the collars. If we were deduct the price of the collars at the strike price during the 1st 3 years, which is 80% of the production that we did the hedges, it would deduct from the NPV around $30,000,000 out of the $537,000,000 So that was guarantee the payback without harming the total value of the project on the long term.

Speaker 1

Kleber, now I turn the floor to you to present the results and then we come back with questions and answers after that.

Speaker 2

Thank you, Rodrigo. Good morning, everyone. So on the stage as usual, we start with a summary of the main financial KPIs for this quarter, the last few quarters. And on this dotted line, we bring the accumulated number for the last 12 months, Pretty much consistent with Rodrigo was explaining, it was a quarter of many record highs in terms of operational results. Our revenues reached $156,000,000 on this quarter and our net revenues now taking last 12 months is already $547,000,000 at the end of this quarter.

Speaker 2

When we look at true adjusted EBITDA as Rodrigo was showed, our EBITDA increased significantly on this Parker to $78,000,000 coming from $56,000,000 on Rodrigo's Parker. And when we look at the dotted line, we see trends also in the last 5 quarters of increasing. Our trading last 12 months EBITDA with a big acceleration now on Q3, Q4, reaching 2 $20,000,000 And if the gold price is staying where they are, we should see another acceleration on Q4 as well. When we look at net income, we reported a net loss of $12,000,000 on this quarter. That is once again similar to what happened in the last few quarters related to the non cash losses today related to the growth hedges market to market.

Speaker 2

We see that has happened and when I have a one page to explain more detail because that happens since the Q4 of 2023. And if we exclude these impacts of the market to market losses on this quarter, our net income, which is the adjusted net income that we highlighted at the bottom, would have been positive at $43,000,000 much more consistent with the operational results. And then on the bottom, the right side of the page, we see the progression of our cash and net debt. We see on this 3rd quarter both the cash and net debt consistent with the previous quarter. We ended the quarter with $196,000,000 in cash, not including yet the proceeds from the inventory that we issued in October at almost R1 $1,000,000,000 is about 175,000,000 dollars So in October, our cash position increased significantly on this 196.

Speaker 2

Our net debt remained stable at $144,000,000 which is very positive considering Q3 was the quieter that we made. We invested the most in the CapEx for the Burbadema project. In the same direction, very positive. We see the reduction in our net debt over last month's EBITDA ratio coming from 0.8 in the last quarter to 0.6 now. Now understanding the main items between our adjusted EBITDA and net income for the quarter, we see out of this $78,000,000 EBITDA that we reported.

Speaker 2

3 business units reported very strong numbers. Minoza reported at $27,000,000 EBITDA. Arantes U. S. Dollars 24,000,000 so the pre can be very strong.

Speaker 2

Apoena despite a weaker quarter with the production also reported a $10,000,000 EBITDA. Then amortization and depreciation expense is on $17,000,000 in it's above what we saw in the last few quarters. That's mainly because of those increasing production we're recognizing more depreciation in our results. And then one of the biggest items for the partner was the financial expenses that we had expense of $63,000,000 in the partner. Most of that's related again to the market to market losses related to the derivatives, which were close to $57,000,000 this quarter higher than the previous quarters, which haven't got a goal next stage in market figures.

Speaker 2

Then income tax expenses are $10,000,000 according to our expectation, bringing the quarter to a net loss of $12,000,000 but then we bring it back the market to market impact. We see that we would have ended the quarter with adjusted net positive of $43,000,000 Then on stage, we bring an analysis to help us understand the accounting impacts of the market to markets especially the Sparker but also the previous Sparkers and the relationship of these accounting losses with the increasing global prices. Here on the right side of the page, we bring the closing gold prices at the end of each quarter. We see that fortunately the gold pricing has been increasing consistently over the last four quarters with the biggest increase being owned this last quarter to 2024 where gold prices increased by $3.30 per ounce. Then on the right side, we see there is a correlation between our market to market liability and increase in liability with such increase in gold prices.

Speaker 2

We see in quarters where the gold price is increasing more, the liability and therefore the market to market loss increasing more and in other quarters increased both price increase less and the provision also increased less. And the biggest increase in the market to market like the Italian market to market loss was also in this last quarter consistent with the recent increase in book prices. And then on this page, we try to shift from an accounting view more to, I would say, an economic view, what is expected to be the cash impact in our future cash growth of our outstanding gold derivatives. Currently, we have about 290,000 ounces of outstanding gold dollars. We fixed the expiry rates ranging between now to 2024 and the year of 2028.

Speaker 2

We see on this quarter, we have about 40,500 ounces of 3rd quarter dollars expiring. And then when we see from 2025 to 2028, most of same gold colors are related to the Berbatim hedging program. As a reminder, when we announced the construction on Berbatim, we also announced that we were entering a hedging program to hedge the 1st 3 years of production, 80% of the 1st 3 years of production of the Bergobodema projects, but through gold costs that we see what's most outstanding here. On the bottom of the page, we bring that what's the average strike price of these outstanding co options per periods. We see on average it's $2,400 which at current spot prices or if gold continue going up, These colors are in the money in favor of the banks against oil.

Speaker 2

But we also bring a reference what would be our future production, especially when propylene comes online to show that these outstanding derivatives are a small portion of our expected future production. We have another line with the 353,000 ounces of gold equivalent. This is not a projection or a guidance. This is more of a pro form a number, which is taking our last 12 months production and adding what is the average year in production for Berglorema since most of these outstanding gold covers are related to Berglorema. So we see depending on the year between 20% and 25% of our production between 25% and 27% would be hedges, which means 20% to 25% of our production hedging flows will be capped at $2,400 which means that the majority of our production 75% depending on the year 80% will be exposed at your prices.

Speaker 2

That's why continuing increasing food prices should be a disproportionate positive impact yet in our future head growth as the important one that is having is just a more proportional part of the future or expected future production. Now shifting to a view on the change in our cash and cash equivalents throughout the Q3. We see we started the part with $192,000,000 in cash and equivalents. Then on this left side of the page is what we call the adjusted free cash flow to firm, which is the free cash flow to firm generated by the 4 months in production, not including investment and expansions. We see that portion of the business generates strong cash flow, dollars 65,000,000 in the quarter was also record high in the reserve of the company, which was more than enough to pay for both investments for growth in the quarter that was 50 $1,000,000 of which about almost $40,000,000 was related to the CapEx of the Burolemia project.

Speaker 2

So very positive what we generated in the quarter more we paid for the cash expenses mainly in the Burolemia project construction in the quarter. And then here to the right side of the page, the financial items highlighting that we invested $6,000,000 to do share buybacks. And here is the same analysis looking for the year, the 1st 9 months. So similar conclusions, the cash flows generated by the mines in production were $113,000,000 That was more than enough to pay itself for the investment of our growth in the same period that was $95,000,000 And then to the right side, I would highlight the dividends and share repurchases. We're returning $35,000,000 to shareholders in the first 9 months, not including ex the dividend that we just announced yesterday and bringing the cash flow closer to $200,000,000 And then we will be in our financial projections.

Operator

We are going to start the question and answer session for investors and analysts. Our first question comes from Guillermo Niipes with XP. You can open your microphone.

Speaker 3

I have two questions here on our side. My first one is if you could provide us with an update on how you plan to prioritize the projects currently in your pipeline given that you have now the acquisition of Bluestone and also considering that you have the other projects like Matupao, Tamira and Serra da Estrella? And my second question is on Almas and considering that you have the contractor transition, can we see any potential upside from here in terms of production and cost for Q4? I know that the production increased almost 40% this quarter and cost declined by over 20%. But just to make sure that this is the normalized levels for Almas as well and if you could see any potential upside looking further?

Speaker 3

That's these are my 2 questions. Thank you.

Speaker 1

Sure. Thank you, Guilherme. So in terms of the sequence of the project is, for sure, our main priority today is to finish construction of Burmolemo on time on budget. Why we are now aggregating and doing exploration investments in Matupa, particularly in Pezo, right, so that we can aggregate it to Matupa next year and our objective to start the construction hopefully to the end of next year. That depend on the results of exploration that we might have through Pezo and also Paquenci.

Speaker 1

That is then what is scheduled. Bluestone, Nayate is a transaction that needs to be closed in January. And after that, we will be able to provide more information. Although we expect a few years to although the project is fully advanced in terms of exploration and also engineering, we understand that it might take time to do to get full support from central government and local authorities, including the socializing. So that might take a few years.

Speaker 1

And of course, if those conversations goes faster than expected, then we could reshuffle and prioritize. But yet, Matopay is our main. We continue to do we renew the option inside the Estrela, so we continue to do exploration. We've been of course, if we renew the options because we saw a very interesting potential, which we are now at the dry season doing more drilling. We plan to disclose more information on the results along the next year.

Speaker 1

We've been very optimistic that this can be very interesting for AURO, but that will take yet additional 2 or 3 years of explorations until we have a pre feasibility study or the feasibility study. So you still have some time out drilling. In terms of almonds, as you could see, we had a big jump from transitioning last quarter Q2 to Q3. Though we are working in more improvements, expanding the plant and so on, that would be now more gradual. You should not expect to have a higher jump in almonds, but low and constant improvements now on the day to day that we are doing, but not a big step such as we had from Q2 to Q3.

Speaker 3

Thank you.

Operator

Our next question comes from Ricardo Monengaglia with Safra. You can open your microphone.

Speaker 4

Hello, everyone. Can you hear me well?

Speaker 1

Sure.

Speaker 4

First of all, congrats on the results. It was good to see the continuity of this growing trend. And as you said, you expect another sequential growth in 4Q. But just to understand, during last quarter's conference call, you mentioned that production could reach the quarterly production could reach a level above 70,000 ounces. Your production in Q3 was closed and maybe Apo Eno was the key issue for not reaching that target.

Speaker 4

So if you could remind us what are the main challenges for production in this operation and maybe if you could let us know what could we expect for normalized quarterly or annual production level in this operation of Apoena, this will be interesting. And the other question, as everyone knows, gold price has been on an amazing run over the past year. So I just wanted to see what is the outlook for gold prices in your view? And do you think that a Trump or Harris administration will have an impact on that? Thank you for the opportunity.

Speaker 1

Thank you. Ricardo, just going back to the first question. It was about production levels on Q3, you mentioned 70,000. If for the good news, gold price has increased, but that also impacted the gold equivalent production, as I mentioned. If it were not that, we would have been above 70,000 production in the quarter and again, above 70,000 during Q4.

Speaker 1

But then gold price increases, so the gold equivalent translates to a lower volume. So for a very good reason, we did not reach the 70,000. And hopefully, with gold price continue to increase and we have this challenge for Q4 during this year. Poiena, it's we're not providing yet the 2025 projections for the market. We should see an increased production during Q4 this year.

Speaker 1

Yet, it's a mine that even next year, we will have time to develop more, open more the mine. The exploration results has been very interesting, so we might have to invest more to open and have a very interesting years after we have all this preparation done. So Apuena, I would say that we will have a minor improvement during Q4, but we should not expect a major also change during the next quarter. Last question you mentioned was about gold prices. I think gold price has been surprising the market.

Speaker 1

We caused an increase independently from the elections. I think what the market says is that either Trump or Kamala, they are not focusing yet. They haven't disclosed much what they will do to control the fiscal deficit. So in that direction, I think either one, we continue to not have a fiscal discipline and that is favorable for gold prices as well.

Operator

Next question from

Speaker 5

Okay. Can you hear me?

Speaker 1

Now, yes.

Speaker 5

Okay. Hi, Rodrigo. Hi, Carlos. Thank you for the questions. Congrats for the results.

Speaker 5

Another quarter with improvements in operating rates. So I have two questions. The first one is a follow-up on Ricardo's questions on the BP. We know that you have a very complex operation there with several mines. So my points here, the first one, for how long do you expect to operate at Nosti?

Speaker 5

And looking to the medium to long term, which are our plans there? You had those studies about that super pit. Do you even considering going underground there? How do you think about these operations in the medium to long term to have lower volatility to results? And then my second question and also a very specific one on San Andres, we saw that production has improved significantly over the past few quarters, but with a very different profile from what you had before.

Speaker 5

Your grades remain relatively low compared to 2021 2022. And also your recovery rates remain well below what you had in those previous years. But your plant feed has increased significantly. So your production at the end remains very solid. So can you please explain what is behind these lower recovery rates now close to 62% to 65%?

Speaker 5

And if this new profile for operations, let's call it this way, with higher plant feed and lower grades and recovery rates is what we need to expect going forward. Do you can you operate with this higher plant feed? Do you have any bottlenecks regarding plant feed? Maybe not because you have a deep leaching operation there. But if you could give more color here, it would be great.

Speaker 1

Thank you. Thank you, Adriag. So first thing in Apoena, yes, I think the mine is moving us to have a bigger open pit. We don't feel it's going to be underground, but all the information that we'll be receiving on exploration shows a path to a bigger pit along the medium term. I believe it's going to be volatile for the next quarters up to the end of 2025.

Speaker 1

And then after that, we start to open up all the mine and then that will create more stability in terms of production. On Honduras, on the other hand, of course, the other operations in Alma is very stable and then with the gradual improvement in next year also comes online, Borborema. And Honduras, we that change comes from the change in ore body. As I mentioned, the nature is not equal everywhere, so it has some changes. We enter now in the lower grades that we should see this now stabilize at this level of grades.

Speaker 1

We don't see going back to higher grades that we saw 4 years ago. And when you have lower grades, also the recovery is lower, right? It goes a little bit together. Although we feel that the team has been working significantly to increase recoveries, I think we can achieve above 65% with the improvements that we are doing. In terms of piling, there is a bottleneck.

Speaker 1

I think we are very much at the bottleneck right now. I think there's not much what we could do to improve production. On the other hand, there's always alternatives, initiatives for us to keep the reduce the cost.

Speaker 5

Great. And if I may, just a follow-up on the first question as well. It has been only 1 week since the announcement of the deal with Bluestone. Have you had the chance to talk with the local governments? What was the reaction there?

Speaker 5

Or still early to say here?

Speaker 1

It's early to say. Yet we entered in the process of acquisition. We are not the owner of the asset. So we can and we should only contact the government after the closing. So that we go through January.

Speaker 5

Okay. Thank you. Thank you very much, Rodrigo Gabriel. Thank you.

Operator

The question and answer session is over. We would like to hand the floor back to Mr. Rodrigo Barbosa for the company's final remarks.

Speaker 1

Well, so I would like to thank everybody. I think it was a very strong quarter as we could show. I think as important as the strong results is to see what Aura has been able to achieve along the last years and project what is coming for the next year. So quick remind our investors, we did our dual listing in Brazil when we did a re IPO of the company with a project to come from 200,000 ounces to 400,000 ounces developing Alma in Matupa. And our strategy was also to unlock value through exploration and also through M and A since while we would pay dividends with the market.

Speaker 1

Since then, we paid 13.5% of dividend yield in 2021, 6% in 2022, 6% in 2023 and in the last 12 months now reaching 9% of ilmenil. In the meanwhile, we also acquired Burborema. We built Almas. Now we are building Burborema. We acquired Serra da Estrela.

Speaker 1

We're doing exploration. We're more we are increasing our resource and reserves as we are moving to higher production and recently also entering the process of acquisition of Bluestone. So we've been able to diligently deliver to the market the big picture, which is to grow, to unlock value through also execution of the greenfield projects, almost online, on time, on budget and now at full production at a lower cash at the cash cost that we're projecting. Borborema, more than half of construction done, coming the ramp up on time on budget expected through the Q1 next year and commercial production along the next semester. We also recently announced Bluestone, which are project that we will see when we would be able to build, but that's a world class asset that would add significant ounces to our production with a lower cash cost as well.

Speaker 1

All of this while we're also doing exploration moving forward with Matopao, we have now acquired Apezone, our option to Apezone and Paquenci. Saha de Estrela also moving forward, we hopefully we can translate this exploration program into a PEA or pre feasibility study in the next 3 to 4 years. So we are very much on track to reach the 450,000 ounces of gold equivalent within the project that we already have or even surpass this if we succeed with Bluestone and develop it in the next couple of years. So I would like to thank all for participating in this call. Very strong results, very strong quarter during Q3 with gold prices at $2,500 Gold price today is at $27 above $2,700 and that will continue to push our results higher.

Speaker 1

Costs are under control. And next year, remembering and reminded that Enter, a major mine for us, which produce close to 85,000 ounces of production on a yearly basis with a lower cash cost compared to what we have today. So we will be able to continue to increase production while we can also reduce the cost and now with a very favorable gold prices. So I think we've been very strong delivering results, not only the results, but also the strategic project levels and then unlock value to our shareholders. So thank you for participating.

Operator

Auras conference is now closed. We thank you for your participation and wish you a nice day.

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Earnings Conference Call
Aura Minerals Q3 2024
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