Calibre Mining Q2 2024 Earnings Call Transcript

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Provided by Quartr
August 13, 2024

There are 5 speakers on the call.

Operator

Good morning, and welcome to the Caliber Mining Corp. 20 24 Second Quarter Conference Call. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

Operator

I would now like to turn the conference over to Ryan King. Please go ahead.

Speaker 1

Thank you, operator. Good morning, everyone, and thank you for taking the time to join the call this morning. Before we commence, I'd like to direct everyone to the forward looking statements on Slide 2 of the presentation. Our remarks and answers to your questions today may contain forward looking information about the company's future performance. Although management believes that our forward looking statements are based on fair and reasonable assumptions, actual results may turn out to be different from these forward looking statements.

Speaker 1

For a complete discussion of the risks, uncertainties and factors, which may lead to actual operating and financial results being different from the estimates contained in our forward looking statements, please refer to the Q2 year to date 2024 MD and A and consolidated financial statements available on our website as well as on SEDAR Plus. And finally, all figures are in U. S. Dollars unless otherwise stated. Present today with me on the call are Darren Hall, President and Chief Executive Officer Daniella Dimitroff, Senior Vice President and Chief Financial Officer and Tom Gallo, Senior Vice President, Growth.

Speaker 1

We will be providing comments on our 2nd quarter and year to date 2024 results, after which we'll be happy to take questions. The slide deck we will be referencing is available on our Web site atcalibarmining.com under the Events section. You can also click on the webcast to join the live presentation. With that, I'll turn the call over to Darren.

Speaker 2

Thanks, Ryan. Moving to Slide 3. Good morning and thank you for taking the time to join us today. Firstly, I would like to thank all Caliber employees and business partners for their continued focus and diligence to responsibly deliver another quarter. The organization's commitment to act like owners is demonstrated in the following three recent milestones.

Speaker 2

In June, the Caliber team in Nevada surpassed 3 years without a lost time injury. In Q2, our Nicaraguan operations reported year 3 conformance with the World Gold Council's responsible gold mining principles. This significant milestone reflects the team's commitment to foster positive impacts on the environment, engaging with and supporting local communities and upholding rigorous governance standards. And in early August, the team at Ballantyne passed 2,000,000 hours worked without a lost time injury. Switching gears, I would like to take this opportunity to welcome Daniela Dimitroch to the team as Caliber's SVP and Chief Financial Officer.

Speaker 2

Daniela joined Caliber in June and positive contributions are already evident. I look forward to Daniella's insights and contributions as we continue our journey to a quality midyear gold producer. Moving to the quarter, consistent with expectations, the company delivered 58,754 ounces of gold in the quarter. Q2 saw higher tons mined, largely stripping at the open pits in Nicaragua, resulting in short term cost tension that's setting us up for a stronger production leading to lower all in sustaining costs in H2. Given our projections for the remainder of the year, we are on track to deliver into our full year production guidance of 275,000 to 300,000 ounces.

Speaker 2

The team's progress at Ballantyne in Newfoundland has been very pleasing as we march towards 1st gold in Q2 2025, which I'll talk to more shortly. I'm excited by the significant exploration opportunities across our portfolio of assets, not the least being on our Ballantyne property, where we recently commenced 100,000 meter drill program. More on that in a minute. Turning to Slide 4. As mentioned, 1st gold of Ballantyne remains on schedule for Q2 2025.

Speaker 2

The addition of Ballantyne to our portfolio of assets will establish Caliber as a quality mid tier gold producer in the Americas, providing a compelling re rate opportunity for all shareholders. I am pleased to report the construction of the fully funded Ballantyne Gold Mine was 77% complete at the end of July and the team continues to make good progress consistent with the schedule and spend provided in our May project update. A few recent highlights. Line replacement is well advanced at the tailings management facility and we expect to retain water by the end of September. SAG, ball mill and primary crusher installation is well underway.

Speaker 2

CIL tank area construction is nearing completion. Steel mechanical piping and electrical and instrumentation is advancing consistent with schedule. The operations leadership team is employed and engaged in pre commissioning activities with RCC. Importantly, federal environmental approval and provincial mining and surface leases for the Berry pit and associated infrastructure have all been obtained during the quarter. We have commenced a scoping study to review Phase 2 process plant expansion options focused on investigating combinational circuit alternatives.

Speaker 2

Is early in the analysis, but I'm encouraged that there are options which may present even higher returns than the feasibility study envisaged with the original Phase 2 plan. With CAD211 1,000,000 in initial project capital remaining to be spent and CAD350 1,000,000 in cash and restricted cash, the Valentine build is fully funded. Moving to Slide 5. This slide provides an aerial view of the Valentine site looking southwest over the tailings management facility towards a process plant and mining operations. The photo provides a good perspective of not only the scale of the project, but importantly, construction progress.

Speaker 2

It's great to see the project evolve as the team steadfastly progresses towards 1st gold in Q2 2025. Turning to slide 6. The Valentine Gold Mine surrounding property offers a robust 5,000,000 ounce resource base and numerous discovery opportunities from an extremely prospective array of exploration targets with similar geology to the prolific Val d'Or and Timmins camps in the Abitibi gold belt. It is this prospectivity coupled with the encouraging results we've seen, which supports the recently announced expansion to our Valentine exploration program. During Q2, we commenced an additional 100,000 meter drill program across the flagship property to confirm the vast potential of the Valentine District comprised of 64 kilometers of high potential discovery opportunities along the 2 parallel shear zones.

Speaker 2

This program is in addition to the previously announced 50,000 meter oil control RC drilling program and the 10,000 meter Winky RAB drilling program, which is focused on testing for bedrock geology. Additionally, drill results from the exploration programs across Nicaragua reinforced the potential for discovery and resource expansion, both within the 176 kilometer Square Kilometer Eastern Barossi Land Package located in the Northeast and the B10 Gold Corridor located within the Limon mine complex. At Bolcan, rapid progress following receipt of key environmental approvals for the development of the open pit resulted in first ore being delivered to the Limpopatag mill within a month of permit receipt, which will contribute to a stronger H2. Drilling at Vulcan confirms the deposit can host higher grade near surface gold mineralization in excess of the initial open pit resource average of 2 grams per ton. Moving to Slide 7.

Speaker 2

In closing, I'm confident in our ability as we have demonstrated to deliver on our commitments. With detailed engineering at 98% and construction at 77%, Calibra is well positioned to responsibly deliver the Valentine Gold Mine and commence production in Q2 2025. The company remains committed to deliver into our 2024 production guidance as we drive increased production and lower costs during the second half of the year. With demonstrated resource growth and discovery potential across all assets, Caliber will continue to add significant value through investment and exploration. We will continue to look forward, grow the company organically, maximize the full potential of our existing assets and choose the most sustainable and accretive path forward to drive shareholder value.

Speaker 2

With that, we're happy to take questions. I'll pass it back to you, operator.

Operator

Our first question comes from Dom DeMarco with National Bank. Please go ahead.

Speaker 3

My first question has to do with derisking of mining in year 1. It's great to see that the build is coming along nicely, but now looking beyond the build, can you remind us of the reconciliation drilling in the pits that are planned to be mined in the 1st year?

Speaker 2

Yes. Good morning, Bill, and thanks very much, Bob. Yes. No, if we look if we remember back in February, we provided an update on the infill drilling there at Leprechaun, and we saw positive reconciliation results both in tons and ounces. And additionally, led us to identify some extensions to leading from the Southwest to Leprechaun into the Frank zone, which Tom and the exploration team have been following up with infill drilling as well, and we've provided some results and we look forward to providing some additional results in the very near future.

Speaker 2

But that being positive, we continue we've been continuing the background with infill drilling in Barathon and we would anticipate in the next month to 2 providing an update there as well. But initial results are not disappointing supposed to say.

Speaker 3

Okay. Thanks. And then shifting to Nicaragua. We saw the press release that you're now mining from the recently permitted Vulcan pit. And there was no adjustment to guidance, but is this sort of on track with your timing?

Speaker 3

Or do you feel that maybe you're into this Vulcan pit a little earlier than expected?

Speaker 2

No, Don. It's consistent with, as we'd foreshadowed earlier in the year that we were H2 weighted. We did have some impacts earlier in the year, which moved some ounces from Q2 into H2. But ball calm was always part of the plan in the second half and particularly as we lead into Q4. So the encouraging thing here was again demonstrating the ability to go from permit to plant very quickly and all delivery into the plant within a month of payment receipt.

Speaker 2

Okay, great. Well, that's all

Speaker 3

for me. Good luck with the rest of Q3. Thank you.

Speaker 2

Appreciate it. Thank you very much.

Operator

The next question comes from Farooq Ahmed with Raymond James. Please go ahead.

Speaker 4

Hi, good morning, everyone. Darren, my question is just kind of looking forward at Ballantyne a little bit. As you get towards the end of the construction and into your start up, which is expected for the Q2 of 2025, The last stages of construction at Valentine seem that they'll be happening through the winter season, particularly Q4 of 2024 and Q1 of 2025. I'm just wondering, given there's probably going to be more challenging weather conditions during that winter season, do you have can you give us some kind of view on how you want construction to move forward ahead of the winter season? Is there a certain kind of milestone that you're targeting or certain things you want to get done before the traditional winter season that might slow things down?

Speaker 4

Or how are you anticipating operating through that season? Will it just be kind of normal and no real slowdown expected?

Speaker 2

Yes. Hi, Farooq. I appreciate the question. And good questions as well. I mean, again, the most talked about thing in Newfoundland is the weather.

Speaker 2

But if we look at where we're positioned as we head into the fall and then into the winter season, The buildings are complete. The major components are on-site. Now we have all the crushers, conveyors, SAG mills, ball mills being erected. The majority of that work will actually be done prior to the winter. Now we would anticipate being substantially mechanically complete early in Q4 in advance of the winter.

Speaker 2

And then additionally, the majority of the work that will be done during the winter will be done undercover inside the mill. So no, I think we're actually well positioned given the timing of activities heading into January, February timeframe. So with the filings facility, as I mentioned, will be materially complete here in Q3 and we'll be in a position to take water. Those civil works will be behind us as well. So no, I think we're really well positioned.

Speaker 4

Okay, that's good. Thanks for that color. Maybe if I can ask a follow-up question that's more kind of more strategically focused. And I appreciate that a lot of your concentration and effort right now is focused at the project at Valentine. But if we kind of look a little bit forward and assume that Valentine will start up as expected, Going forward, do you see obviously, then you diversify your production base after that.

Speaker 4

But going forward, do you see Nicaragua as an area that you would want to continue to consolidate and continue to look for opportunity to acquire new assets? Or are you kind of happy with your Nicaragua exposure at this point and would potentially look elsewhere as you potentially look to expand?

Speaker 2

Thanks, Farooq. An interesting question. And of course, it gets lots of airplay both management and with the Board. But if you think of our single determined focus right now, it's to continue to deliver in Nicaragua, continue to deliver in Nevada. And above all else is delivering the expectations with Ballantyne.

Speaker 2

And as we just talked about, we're well positioned given the 98% level of engineering we've got complete, the 77% construction complete, being mechanically complete here in Q4, we're positioning ourselves well delivering to. And anything that distracts from those three core activities in addition to reinvesting in the drill bit for that organic growth is very destructive. So we're open to consider other opportunities. But again, at this time, our focus is exclusively on those aspects of the business. And as we can and look to the future, we'll consider other things.

Speaker 2

But right now, the team is absolutely more effectively focused on those three aspects of the business.

Speaker 4

Okay. Thanks for that Darren and good luck with the rest of the way on Valentine and looking forward to seeing the project in September.

Speaker 2

Yes. Looking forward to hosting the visit in the 1st week in September and great it will be great to see you there and I'm sure you'll walk away feeling pretty positive about what you say. So thanks for

Operator

Seeing no further questions, this will conclude our question and answer session. I would like to turn the conference back over to Darren Hall, President and CEO for any closing remarks.

Speaker 2

Thanks, operator. I'd like to thank all of our shareholders for their continued support and your participation in questions this morning. As always, Ryan, I and the entire leadership team are available if you have any further questions. And with that, I'd like to wish everyone a wonderful and safe day. Back to you, operator.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines and have a wonderful day.

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Earnings Conference Call
Calibre Mining Q2 2024
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