Compañía de Minas Buenaventura S.A.A. Q4 2023 Earnings Call Transcript

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Provided by Quartr
March 1, 2024

There are 12 speakers on the call.

Operator

Good day, ladies and gentlemen. Welcome to the Compagnia Diniz Buenaventura 4th Quarter 2023 Earnings Results Conference Call. At this time, all participants are in a listen only mode. And please note that this call is being recorded. I would now like to introduce your host for today's call, Mr.

Operator

Gabriel Salas, Investor Relations. Mr. Salas, you may begin.

Speaker 1

Good morning, everyone, and thank you for joining us today to discuss our Q4 2023 results. Today's discussion will be led by Mr. Leandro Garcia, Chief Executive Officer. Also joining our call today and available for your questions are Mr. Daniel Dominguez, Chief Financial Officer Mr.

Speaker 1

Juan Carlos Ortiz, Vice President of Operations Mr. Aldo Masa, Vice President of Business Development and Commercial Mr. Alejandro Hermoza, Vice President of Sustainability Mr. Renzo Maher, Vice President of Projects Mr. Juan Carlos Salazar, Vice President of Explorations Mr.

Speaker 1

Roque Benares, Chairman and Mr. Raul Benares, Director. Before I hand our call over, let me first touch on a few items. On Buenaventura's website, you will find our press release that was posted yesterday after the market closed. Please note that today's remarks include forward looking statements that are based on management's current views and assumptions.

Speaker 1

While management believes that its assumptions, expectations and projections are reasonable in view of the currently available information, you are cautioned not to place undue reliance on these forward looking statements. I encourage you to read the full disclosure concerning forward looking statements within the earnings results press release issued on February 29, 2024. Let me now turn the call to Mr. Leandro Garcia.

Speaker 2

Thank you, Gabriel. Good morning, and thank you for joining us today to discuss the portfolio results of the company. On Slide 2 is our cautionary statement, important information that I encourage you to read, please. We assume that you have already read the full year 2023 results reported yesterday. Moving on the next slide, our presentation will cover the 5 main topics shown on this agenda and will be followed by our Q and A session, where our team and myself will be happy to answer your questions.

Speaker 2

Let's begin with some overview of the key highlights of the 2023. Our EBITDA from direct operations for the 2023 has increased 38% compared to the previous year. It is worth mentioning that the figures do not include the $300,000,000 obtained last year from the sale of our stake in Yanacocha. Our cash position remains strong in the Q4 of last year due to a strong performance at El Brocal, resulting in a leverage rate of 205x, the lowest in 2 years and within our target range. Full year 2023 net income was $33,000,000 negatively impacted by $113,000,000 noncash provision related to formats and ad disputes.

Speaker 2

Capital expenditures in 2023 totaled $239,000,000 including $94,000,000 allocated to the San Gabriel project. Additionally, Buenaventura made an extra investment of $33,000,000 in advance payments for the San Gabriel project. When taking into account both aspects, the total disbursement for San Gabriel project amounted to $127,000,000 We are pleased to share that our dividends received from Cerro Verde during the quarter have contributed to up to $49,000,000 strengthening our overall financial performance. The company received a total of $147,000,000 in dividends for the full year 2023. Production from Jumpak's pilot stope began in November 2023, producing 2,300,000 ounces of silver by year end.

Speaker 2

Yumpa continued processing ore from the pilot stop through January 2024, after which mineral processing was suspended until definite operating permits are obtained, expected by the end of the Q1 of this year. Yumpak is therefore expected to release mineral processing in the Q2 of this year. Record 2023 copper production resulted from successful migration to March's underground network, enabling El Brocal to ultimately achieve an average of 10,800 tons per day during the Q4 2023, surpassing its targeted 10,000 tons per day underground mine exploration rate. Our consolidated production of copper, silver and gold throughput 2023 has yielded the following results: 58,000 tons of fine copper attributed to the exceptional production at El Dorcal, meeting the upper range of the guidance 9,200,000 ounces of silver, achieving the full year guidance. During the Q4 of 2023, Uchucchacua and Yupac contributed with 2,600,000 ounces.

Speaker 2

455,000 ounces of gold with consistent production of Orcopampa. This production enabled us to surpass the upper range of the guidance. Moving on to our cost structure in Slide 5. Aligned with our strategy to increase our copper exposure, we are showing the all in sustaining cost figures as copper and gold equivalent. Here, you can see that our 2023 all in sustaining costs have reduced by 8 percent 27%, respectively, year over year.

Speaker 2

This reduction is primarily attributed to the copper production at the Brocal and silver production at Yumpa. However, it is important to mention that both figures are at consolidated basis and include 100% of Buenaventura, La Sancha and Evrocar. Moving on the cost applicable to sales strength. As you can see, the prioritization of copper ore at El Brocal and the ramp up in the underground mine is translating into a 10% cost reduction year over year. Silver cash has decreased 3% year over year, primarily driven by lower cost during the Q4 of 2023 with the contribution of Uchucchacua and Yumpac silver ounces.

Speaker 2

Gold cash has remained relatively flat year over year despite the resource depletion at La Zanja and lower production in Tamomay. On the next slide, we will be presenting the free cash flow generation. During 2023, we reduced our cash position by $34,000,000 primarily due to the intensive capital expenditure campaign, which includes San Gabriel. EBITDA to free cash flow reconciliation is explained by the following breakdown of inflows and outlook. Edrocala, Orcopampa and Tambomayo have been the main contributors for the 2020, while La Zanja, Fulcana and Uchucchacua had a negative EBITDA due to the lower production for the first two assets and care and maintenance at Uchucchacua for the 1st 9 months.

Speaker 2

However, we recorded a positive EBITDA for the Q4 of 2023, thanks to the resumption of Uchucchacua and the contribution of YUP. As we have mentioned before, Buenaventura is going through a growth phase with an extensive CapEx related to Yumpa and San Gabriel. This has been partially offset the dividends received from Cerrobel. In the following slides, I would like to illustrate our main 4 flagships. First, Yumpa producing at full potential once the definite operating permits have been obtained expected by the end of the Q1 of 2024.

Speaker 2

2nd, El Brocal underground mine expansion at 12 tons per day in the following 2 years 3rd, San Gabriel ramp up and the 1st gold bar during the year 2025 and for total revenue distribution for approximately between $120,000,000 $150,000,000 in the following year. As you can see, our Flexion mines offer over 10 years of uninterrupted research and resource extraction. We have updated our resource and reserve values, showing. In copper, we have 1,900,000 tons of reserves along with an additional 3,100,000 tons of resources. In silver, we have 128,000,000 ounces of reserves, with Dupont making a significant contribution.

Speaker 2

Additionally, we have 199,000,000 of reserves. Lastly, in gold, we have 2,800,000 ounces of reserves with Sangavell being our primary future gold production source. Additionally, we have 3,500,000 ounces of resources. Moving forward to our 2024 guidance. As evident, the prioritization of copper ore at El Brocal and the ramp up in the underground mine will enable us to maintain an annual copper production in 2024 between 55,000 tons and 60,000 tons per year.

Speaker 2

Silver production will see a 65% year over year increase, primarily due to the contributions of Uchucchacua and Yumpac silver also. Gold production will decrease by 12% year over year, primarily due to the reduced contribution of Trambomayo Gold Alts. Lastly, it is also relevant that in 20 24, we estimate executing between $300,000,000 $320,000,000 of CapEx, with approximately $220,000,000 allocated to development of San Gabriel. The total CapEx estimates for the project are being reviewed due to some delays and escalation costs. We are continuously looking for optimization and efficiencies in the project to control the CapEx as much as possible.

Speaker 2

Moving on to Slide 10. In the next years, Buenaventura will be focusing most of its efforts in San Gabriel project because it will be a relevant contributor to the company's value. It will add more than 14 years of life of mine to the company and another 14 years if we consider the results. On this slide, you can see the projects progress quarter by quarter. In the upcoming quarter, we will complete installation of the concrete plant and the construction of the dams.

Speaker 2

On the next slide, we are showing the earth movement activities for the processing plant facility. On Slide 11, you can see the progress of the construction until the end of the Q3 2023. While in Slide 12, we can see an update on the construction towards the end of Q4 of 2023. By the 2023 year end, we have filled over 80,000 cubic meters of material and cut over 250,000 cubic meters. On the next slide, we show a couple of photographs of other components or components of the project along with the updates as of the end of Q4 of 2023.

Speaker 2

At the top, you can see the San Gabriel definite campsite with a 98% of progress and over 1,000 beds already installed. The photograph at the bottom show the progress of the main storage area where we already have 40% of the equipment on-site. 30% of the equipment have already arrived to Peru but are pending to be transported to the site. Finally, I would like to finish the presentation with a couple of closing remarks. First, San Gabriel will allow us to stabilize our gold production at 130,000 to 150,000 ounces yearly in the midterm.

Speaker 2

We are on track as we aim for our first gold bar by the second half of twenty twenty five. The ongoing success of Yumpank confirms its status as a world class asset, marked by constantly high silver rates. As we have mentioned, the definite operating permits are expected by March 2024. El Brocal is strategically focusing on the copper underground mine, maximizing margins and gearing up for a robust ramp up to 12 1,000 tons per day in the midterm. We are ensuring full funding for our growth projects and sustaining capital expense.

Speaker 2

Thank you for your attention. I will now hand the call back to the operator to open the line for questions. Operator, please go ahead.

Operator

Thank you, And today's first question comes from Cesar Perez Novella with BTG Pactual. Please go ahead.

Speaker 3

Yes. Good morning to everyone and congratulations for your results by the way. So I have three questions if I may. My first one relates to your material operational improvement in the final quarter of the year, which among several operational enhancements and of course, JMPAG led to an important rise in operating performance in the EBITDA. How should we think about costs in 2024?

Speaker 3

And would the EBITDA that was reported in the final quarter of the year be a new level going forward, of course, assuming stable prices. Could you comment on the sustainability and costs? That would be my first question. The second one relates if there is any situation on any of your direct operations that will encounter some sort of maintenance downtime in 2024? If this would be the case, which quarter and for which operation?

Speaker 3

And finally, there is an article in media that recently resurfaced that says that Cerro Verde plans to execute a series of modifications in its production unit for an investment of around $646,000,000 If this would be the case, what was this specifically involved? And would this imply some expansion at the concentrator? If you could share some views on that and perhaps production guidance for Cerro Verde and CapEx, that would be extremely I would be extremely. Thank you.

Speaker 2

Thank you, Cesar, for your questions. Well, we foresee the cost to maintain in terms of copper and gold in line with the 2023 last quarter cost. In terms of any situation that could affect our any of our units. We have to mention that in Coymolache, we are expecting a permit that will allow us to continue

Speaker 4

the

Speaker 2

works and the piling in the pad. More details maybe, Daniel and Juan Carlos can give you more color to your question.

Speaker 5

Thank you, Julio Andresipo and Carlos. Thank you, Cesar, for your question. Yes, regarding, Leandro mentioned, regarding the operating cost on copper and gold, we foresee kind of stable cost from what we have reported in 2023 coming in line in 2024. In the case of silver, because now we have full year with production in Chapua, Cochinchapua mine and also in Jupac, we foresee a reduction from what was in 2030, 3. Maybe the move will probably grow $19 per ounce of silver in 2023, probably coming down closer to 16 dollars per ounce of silver in these 2 units.

Speaker 5

But it's going to be a longer year because we are ramping up production in Uchucchacua. We are stabilizing production that we have in project into operation in Jupa. So it's going to be a progresses gain in the cost of these 2 units for single production. Regarding the potential downtime in the main of the units, there's a potential risk. So we have delayed the permits in Yumpac that we foresee for the end of the Q1, that probably could make a week or 2 later, that's in the range of risk, hopefully not.

Speaker 5

And in the case of Curmolecho, also expecting some permits in order to build the expansion of that to continue with our leaching operations. So also depending on that. Our guidance also includes the case that we are delaying this construction in Corvallache over the past. So any advance or any speed up of

Speaker 2

the projects will be

Speaker 5

a net gain on the expected production against our guidance that was published a couple of weeks ago.

Speaker 2

Okay. Thank you. To

Speaker 6

add with what Juan Carlos said, in the Q4, Cesar, we had a very strong EBITDA. In the Q1 of this year, we will have a Yumpa paralights for a couple of months. So this will impact the EBITDA of the quarter. However, for the full year, we expect a total EBITDA of around $220,000,000 $240,000,000

Operator

Thank you. And our next question today comes from Carlos de Alba with Morgan Stanley. Please go ahead.

Speaker 4

Yeah. Thank you very much. Good morning, everyone. Just maybe just a very quick follow-up to Cesar's question and to your response on the EBITDA for the year. Under what commodity prices, Daniel, are you forecasting these 200 to 240?

Speaker 6

Hi, Carlos. Thanks for your question. The prices that we're using to these estimates are for gold, dollars 19 100 for copper, dollars 8,500 and for silver, dollars 23 per ounce.

Speaker 2

All right.

Speaker 4

Okay. Thank you, Daniel. So the questions I have, 1 I'll just mention 1 at a time and then we can have a conversation. One is on the can you maybe provide a little bit more color on what you did in the earnings release regarding the Tsunade situation, the tax disputes with the Tsunat. Basically, I understood you took $112,000,000 $113,000,000 provision is non cash because you already made that payment.

Speaker 4

But does this indicate that the likelihood of maybe winning the case is has reduced? How do you see the perspective of your chances of eventually winning the case? Where are we in the legal process? And what comes ahead? What are the next steps?

Speaker 2

Thank you, Carlos, for your question. Actually, we have registered this provision because of the based on the opinion of our lawyers, the probability to win the case is lower than 50%. So I will read as accounting standard, we should register this write off. The case is dead. We continue a second phase that will be in the constitutional court.

Speaker 2

So in that stage, we expect to recover our position and indicate the trial should go back to the Supreme Court. This is for only a part of the all the trial of the process and is regarding the years 2,009 2,009 and 2010. So there is a lot of time to expect and we should it's an ongoing news.

Speaker 4

Okay. And so the next step is for you to file, I guess, an appeal in the constitutional court, right? But you have not done that. And if you haven't, when do you plan to do this? And typically, is there any rule of thumb, any expectation as to how long the process at the Constitutional Court could last?

Speaker 6

Carlos, we have already done this in December. And we are expecting in the following months to have an answer from the Sumant.

Speaker 7

Okay.

Speaker 4

Thank you. And then my next question is on Yumpak and the permits. You mentioned in the press release that you expect to receive them in the Q1. How certain are you of these? Do you have any indications that it could be this potentially could be delayed into the Q2 or Q3?

Speaker 4

How confident are you that the Yumpa could start really ramping up again in the Q2?

Speaker 2

Well, in terms of permit, you know that the country, the administration is trying to make efforts to give to the all the administrators to have shorter times to grant the permits. We are in a daily basis, we have meetings with the organizations and the authorities to save all the questions that they have to allow us to have this to be granted of this permit as soon as possible. We are making all the efforts to have it before the quarter end of this year. Probabilities, I cannot tell you, but be sure that this is one of our daily jobs that we have to do, our daily targets.

Speaker 4

Fair enough, Leandro. And just my last question for you, Leandro or maybe Roque and Raul, how do you envision this new face of the company with a very relevant second large shareholder that now my understanding is potentially could receive 2 seats in the Board of Directors. How do you see the company going forward and what do you expect in terms of this relationship with Antofagasta?

Speaker 2

Well, Carlos, as the management and all the corporate, we are very comfortable with the business plan and the strategy we have. Maybe we have not talked with Santo Farasta yet. We just received the approval of the shareholders to increase the number of directors. So we will see we will expect our first meeting. Maybe, Roque, if you want to add additional comments.

Speaker 8

They are important shareholders and we respect all shareholders. They suggested a couple of names, Mr. Ivana Reagalda and Mr. Andronico Luksic, and we are proposing those names to the shareholders meeting and for approval. I look forward to an excellent relationship.

Speaker 8

I happen to know Mr. Andronico Luksic, the founder many years ago. And I think the industry has a lot of respect for Antofarasta. So we hope to work together and in a very constructive way. There is nothing more than that.

Speaker 4

Thank you, Roque. Thank you, Landro.

Operator

Thank you. Today's next audio question comes from Tanya Jaknishkanek with Scotiabank. Please go ahead.

Speaker 9

Great. Good morning, everyone, and thank you so much for taking my questions. And Rocky, if I can just follow-up on the Antifagasta, It seems from your comments that you haven't really sat down with them to see exactly what they want. I mean, we listened to their conference call in terms of what they mentioned, but I'm more interested in if you've been able to have conversations with them.

Speaker 8

Well, we their interest essentially being a copper company is in the Peruvian market and in the copper assets of Buenaventura. As you know, we have Trapiche and we have Coimolache, we have La Zanja. Obviously, we have Brocal and we have an equity participation in Cerro Verde. So that is what they have told us that is their interest. And they will participate as any other company,

Speaker 10

arm length

Speaker 8

if they want to contribute to develop the projects that we have under development, they will have to participate as any other company as we are talking to people like Sumitomo or BHP in the case of Coimola, that as shareholders, they will be part of our Board and they will contribute with their knowledge. And I think it is a plus for the company.

Speaker 9

So they were interested in sort of all of your copper assets because as you know they are mostly open pit miners. So they are also interested in the underground operations. And are they interested in Trapeche maybe being helping on the development like a BHP like you mentioned, would they be interested on being a partner on Trapiche?

Speaker 8

Well, if they are interested as any other company, we will open and they will have to sign D and A or how you call it, yes, NDA, an NDA. And yes, why not? Antofagasta is a 1st class company and they are specialized in copper and as you say in open pit mines. So nothing extraordinary, Tanya, nothing extraordinary, yes.

Speaker 9

Okay. No, I really, really appreciate that. Thank you so much Rocky for that. Can I just ask maybe a couple of things on just some modeling questions from Daniel and then I want to come back to San Gabriel and Trapichi? Just on the modeling side, Daniel, should I be looking at your 2023 levels for exploration, G and A and selling expenses and is that a similar level for 2024?

Speaker 6

Yes, Danielle. For explorations, you should estimate around $45,000,000 from brownfield explorations and an additional $10,000,000 for greenfield. D and A should be similar to the 1st to Q3 of this year. Remember that in the quarters 34, we had an amortization of the deferred stripping assets at El Brocal. So if you want to model, you should take the D and A similar to the first two quarters of the year.

Speaker 9

Okay. No, that's very helpful. Thank you so much for that. That's helpful. And then can I come back and ask about some of the asset sales?

Speaker 9

When we were at the Investor Day and congratulations on selling one little asset in the quarter, We talked about selling some of the assets to help fund the balance sheet on top of the Sierra Verde dividend that we are receiving. Where are we on the Yanacocha royalty sale? I know we had talked about it at the Investor Day. There were 13 potential buyers. Can you just talk about where you see asset sales in Q1?

Speaker 9

Yes,

Speaker 11

Antonio.

Speaker 2

Alo, please go ahead. Okay.

Speaker 10

Thank you, Leandro. Yes, Tania, we're still in the process of selling the royalty. We have received 5 non binding offers, February 15. The idea is

Speaker 8

to elect

Speaker 10

the one who passed the ROFO of Newmont and maybe make a potential site visit to Yanacocha on March at the end of March. And finally, the idea is to receive the buy in offers on April 15. And then choose 1 and go ahead.

Speaker 9

Okay. So it seems as though Newmont is not involved. It's just other players besides Newmont and you would like to finalize by April 15?

Speaker 11

Yes, this is Elliot.

Speaker 9

Okay. And then I'd like to come just to San Gabriel if I could. I just wanted to understand, I see the picture of the camp, a 1,000 beds. So is the camp done? And what are the critical items for 2024?

Speaker 9

And then at the Investor Day, we were also told that we would be getting updated capital and operating costs. Can you remind me when that's coming?

Speaker 2

Yes, Tanya. I turn the microphone to Renzo, our Vice President of Corporate.

Speaker 9

Thank you.

Speaker 11

Hi, Tanya. The cancer is hi. We have 1,000 beds ready. And besides those beds, we already have another 1,000 beds in the vicinity of the project. So that will not be a problem.

Speaker 11

What you see in the picture is finalizing sidewalks and finalizing the power emergency power plant at the site, those little things that are missing. The main contractor for steel, piping and mechanical will arrive in the next month. So we're going to have everything done by that date. In the second part of your question about what should we expect in 2024? Well, the 1st concrete pool should be in the 2nd quarter.

Speaker 11

And power line construction should start as well in the Q2 of this year. In the Q3, we think we're going to be starting with electrical and signal contractor. And finally, finishing the year with a very good advance with the water dam before the rainy season starts. And I think your last question was about the updated CapEx. And Leandro was saying, we are currently working on that.

Speaker 11

In the next quarter, we're going to be giving the definite estimate numbers. Okay.

Speaker 9

So when you report your Q1, so sometime in April, the end of April maybe we will be getting an updated CapEx. And what about the operating costs?

Speaker 11

The OpEx, we are going to be finishing in the Q3 of this year.

Speaker 2

The update in CapEx should be for the conference call of the 2nd quarter.

Speaker 9

Oh, conference call of Q2. So it's going to be sometime in July?

Speaker 2

Yes.

Speaker 9

CapEx in July and then OpEx in Q3, so October?

Speaker 2

Yes.

Speaker 9

Okay. So thank you so much for that. So we will look forward to getting those, because those numbers as you know are quite stale. They have been there for a long, long time. And then my final question if I can is just on Trapeche.

Speaker 9

I am just wanting to know if you started the public assemblies. Sorry. Are they still going to be starting in Q2? And is the feasibility still on track for the end of 2026?

Speaker 11

So yes, we our environmental impact assessment was submitted, and public assembly should happen in April, in the April timeframe. And yes, we're still on track feasibility study towards 2026. And is that the second row now?

Speaker 9

Yes. Yes. And would it be fair to assume that once you have the feasibility study in hand, that is when you are going to be choose for a partner. We'll look for

Speaker 8

a partner. DANIEL MARTINEZ VALLE:] Okay. Thank you. DANIEL MARTINEZ VALLE:] Thank you.

Speaker 10

DANIEL MARTINEZ VALLE:] Thank you. DANIEL MARTINEZ VALLE:] Thank you. The idea is to choose for a partner.

Speaker 2

We look for a partner.

Speaker 9

Okay. Thank you so much for taking all my questions. I could go on all day, but let me pass it on to somebody else. I really appreciate it.

Operator

Thank you. And our next question today comes from Omar Aboulinada with Prima AFP. Please go ahead.

Speaker 7

Good morning to all. Thank you for the call. I have a couple of questions. I guess I missed a little part of the call. So maybe you have answered this, but I would like to know what is it needed to have a fully operational Jumeba since the Q2 of 2024?

Speaker 7

And my second question and last one is regarding Cerro Verde. What is your expectations on CapEx for this unit on a number basis for the next 3 years?

Speaker 2

Thank you, Omar. Thank you for your participation. In terms of Yumpa, fully operations, we expect to begin in the Q2 of this year. We are just waiting for the operational permit that allow us to resume the operations in Yumpa. In the case of Cerro Verde, we have to review the figures budgeted for this year.

Speaker 2

And the CapEx today that is approved and planned is around $300,000,000 in line with the CapEx that we have been used to in the last couple of years. That is the CapEx we know today. The other projects are in evaluation, I think.

Speaker 7

Okay. So just to add an additional question. These news that we saw in Cestion Sestion related to the $600,000,000 of CapEx in Cerro Verde does not change any at all of your views regarding dividends coming from this unit, right?

Speaker 2

Well, as I told you, Mar, that news that are reappearing in Cristion. It's currently in evaluation, right? The plan today and figures that we have is that the CapEx for this year is $300,000,000 We should have more information in the following meetings with them.

Speaker 7

Okay. Perfect. And if I may, one additional question. This $600,000,000 CapEx is not only for just 1 year. I guess it could be for a couple of years, 3 years.

Speaker 7

It's not going to be disbursed in 1 year only, right?

Speaker 2

Yes. It is kind of a it's a permit. It's an IPS. And the IPS is not for 1 year only.

Speaker 7

Okay, perfect. Thank you very much. Congratulations on the results.

Speaker 2

Thank you, Arun.

Operator

Thank you. Ladies and gentlemen, with that, we will be concluding today's audio question and answer session. I would like to turn the floor back over to Gabriel Salas, Investor Relations Officer, for any webcast questions.

Speaker 1

Thank you, operator. The first two questions come from Isabella Pacheco from Bank of America. How do you see net leverage in 2024? What was the main factor contributing to a positive EBITDA in Q4 2023? [SPEAKER

Speaker 8

DANIEL MARTINEZ

Speaker 2

VALLE:] Maybe Daniel can help us with that question.

Speaker 6

Yes, Dejandro. In terms of the net leverage, we ended this 2023 with 2 signs net debt over EBITDA. As we mentioned before, we count with a facility or different with different banks of $200,000,000 of revolving facilities that we will use when we need the cash to fund San Gabriel in the short term. Probably, we will be using around $150,000,000 from these facilities. And this will, as a consequence of this, the leverage ratio should come up to around 3 times, which will be the maximum that we expect by the end of this year.

Speaker 6

The second question regarding the EBITDA of the Q4, there were basically three factors. One is the sale of Contacto contributed with around $38,000,000 in the EBITDA. The second factor was the stronger production and volume sold from El Brocal. And finally, the restarting operations at Uchucchacua and Yumpac that contributed with around 2,800,000 ounces of silver to our P and L.

Speaker 1

Thanks, Daniel. The next question comes from Orlando Arriga from Credicorp Capital. How much of Yumpa's costs were classified as CapEx during the Q4 2023?

Speaker 6

Yes. There were $10,000,000 of development costs that were not inputted to the cost of sales, because we count with an exploration permit. So the number for the following years to be amortized is $10,000,000

Speaker 1

Thanks, Daniel. At this time, there are no further questions. I would like to turn the call over to the operator.

Operator

Thank you. That concludes the question and answer session of today's conference call. I would like to turn it back over to management for closing remarks.

Speaker 2

Thank you, operator. Before we finish today's conference call, I would like to thank you very much for making the time to join us. And have a again, you have a great day today. Thank you very much.

Operator

Thank you. Ladies and gentlemen, that concludes Buenaventura's 4th quarter 2023 earnings results conference call. We would like to thank you again for your participation. You may now disconnect and have a wonderful day.

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Compañía de Minas Buenaventura S.A.A. Q4 2023
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