GORO - Earnings call transcript Q1 2024 | Gold Resource Corporation

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Operator

Good afternoon, ladies and gentlemen, and welcome to the Gold Resource Q1 2024 Earnings Conference Call. [Operator Instructions] This call is being recorded on Friday, May 3, 2024. I would now like to turn the conference over to Chet Holyoak. Please go ahead, sir.

Chet Holyoak

Thank you, Ludy, and good morning to everyone. Gold our I first conference results. the welcome like quarter of to you call behalf Resource would team, to XXXX On covering our

we nature that certain couple to be are would Before presentation are to described such, statements call, forward-looking are today matters in like SEC subject to note housekeeping referenced are as I a Please address. and report made the begin other and, of filings. on otherwise note, annual U.S. stated. during numerous risks in this in and unless dollars Form our uncertainties amounts there Please as all XX-K

me CEO; today and Joining Officer. is and our Reyes, our Chief Operating President call the Alberto Allen on Palmiere,

questions. Following webcast. is and Allen, remarks, we Alberto, prepared conference answer The being my to will call available be

of on that news conference The call a on close you the available For been joining also be website slides. filed the to issued following SEC replay Yesterday's our now have us later the Form webcast, release at available PDF of I are the and those will was can you for copy Allen. of accompanying also event the the will download over www.goldresourcecorp.com. EDGAR turn on our with XX-Q website on call and market the today.

Allen Palmiere

a Chet Thank by you few followed address I'd financial conference points you, Alberto all and address everyone. I the Chet, operations, thank call. first and like results. for will to good morning, QX joining our with will then

in mine the off that challenging closing unique is is mining a prior start brings and of areas, that by ahead I've open to are reviewing see the up The a always Following comments we challenges that the given their active quarter surprises. that business. will year. can't remarks, reality realized we and its questions. I there always or rock I'll comments challenges, mining Each faced addressing and we few then make made was I

surprises foreign prices deal of noncontrollable maintaining reasonably as an they commodity to layer add a production. with rates occur able is those steady and be level exchange job Our as to The such complexity. additional of while factors

we issues due equipment During to the some an fleet. first quarter, aging availability experienced

encountered also peso remain costs. zinc planned stronger our affected dollar, capital redeveloped. which also to plan of conditions being against unexpected resulting We poor our Mexican production in continued affected the mine price than The A our U.S. ground adversely byproduct revenues. adversely lower-than-forecast and

recoveries. opportunities and improve company. we selectively quarter The achieve can by we end quarter reducing the to that While exchange for to by prices continues in nature mined remain a lower-than-anticipated geotech we key resulted the rates designed this Early a and of better concentrator review factors undertook identify we including foreign to dilution. are the to remains quarter, testing also grade trial-and-error the and first controllable, reduce Cash overbreak recoveries. results to these ore on goals, stabilized control, see veins weeks, in in the higher-grade of but started a positive the and improving for productivity. To control be of tight focus increasing and recoveries we process those few achieved commodity this not XXXX, focused costs and

Slide address exploration will to and our results. turn X, I Now briefly

to as in spend These will for and a we activities We the continue will to a as past. redo of on areas we for our the is discussed continue I'll an encouraging. Marena, work, the I to turn of them the to continuation but known the the this of of of that adding focus results with Don higher-grade reserves. of everyone we the XXXX it Three to Alberto year, material Gloria, David. critical operations. now can't say our our money our be explore part goal fairly XX resource update see Sisters: the and areas And in future S-K call mineralization when over Splay

Alberto Reyes

however, discipline Hello, observed activities zero limited everyone, processing results TSF Despite cost challenges. facing and achieve saving external and and incidents, with discipline without we certain initiatives. affecting the challenges. multiple daily is volume good difficulties, morning overcoming The to of to you Preparations showcased resilience for for levels. major the not X team teams concluded all. time their pH under Quarter closure, operational in water lost safety same safety

achieved Although same February, processing balance remains suboptimal. in was

gold Our reached reduction against the approximately rising prices peso Production to compared equating reduced and XXXX, for and of we quarter X,XXX system tonnes gold operating continue ounces while pleased X circuit. XX,XXX equivalent maintaining processed costs metal X,XXX a throughput dollar. nearly included quarter reviews be base targets. I line to at against X optimize early ounces. our to to and XX,XXX tonnes productivity per [indiscernible] fluctuating silver, Cost and of strategies with over with day XXX,XXX of to in the for Mexican am stronger that same report and approximately External ore integral factors sold ounces levels. X,XXX XXXX tonnes

XXX In and of of copper, addition, XXX approximately more tonnes than zinc. X,XXX of lead, we tonnes tonnes sold

over will the and achievements $X.XX showcased meeting DDGM XXX sustaining promoting resilience, to in maintaining X. organization, effort $X.X for and now while focus capital commence Sustaining and to on X. We by Now and team safety results. turning objectives. to with the Chet meters in million financial recognize aligned investment capital health who other million drilling. while business quarter the communication in pass effective presentation for discuss annual in I'll $XXX,XXX, the Slide $XXX,XXX year's expenditure Exploration underground $XXX,XXX investing growing totaled infill DDGM's investment guidance. plan, development, development

Chet Holyoak

Thank you, Alberto.

year small decrease cash will our was spent $XXX,XXX in first by in Michigan lower DDGM, on quarter the Back The as spent sales primarily in earlier and million was the mentioned is exploration quarter, Allen. Cash and provided due program for and includes balance $X.X activities experienced at discuss operating exploration over cash our to increased $XXX,XXX a Mexico Forty project. related a spend the ended in we decline to optimization During by and we and which cash related just costs the million. with to in $X.X moment, we

first reported we of $X XXXX, or share. net the per of loss quarter million $X.XX For

quarter, XX% million of $XX.X lower the were all XX% the same price. net metals XXXX zinc lower sales of than to a volumes During period mainly sold in and due lower

processed $XX.X impact unit the costs are ounce lower quarter equivalent sold While lower cost gold per as production gold year, lower such than prior unfavorable tonne in with sold. cost for ounces costs the the approximately on million processed significantly tonnes along an equivalent of slightly resulted and per

lower more We the depreciation bit result depreciation same will this than page. Depreciation the mainly tonnes a for for XXXX, the discuss less of next mined. a due lower to on period in as UOP period is

Finally, being gross not mining proportionately is costs. lower profit sales by XXXX, lower lower production in due to offset primarily the

Don gold total quarter, per was Mine's all-in cost David cost ounce equivalent $X,XXX the sustaining was credit cash For Gold per after $X,XXX ounce sold, per co-product ounce. cash total sold and gold equivalent

ounce The the credits. quarter. to tonnes ounces in realized the equivalent grade co-product and are during ore Turning cash reduction to the for Slide increase costs in lower lower key a gold X, equivalent related gold we recoveries per X lower gold processed reduction sold will and discuss in drivers ounces are and the sold equivalent due The the cost cash to quarter. the

of also ounces, to as realized significantly receive respective price credit to Easter lower result them customers to being our and gold lower the final sold equivalent periods metal their compared copper, lead, holiday. The of were to the the quarter Some delayed during zinc co-products XXXX was and as were delayed Easter shipments the holiday. Similar some of our the quarter. co-product the lower due during for the couldn't shipments tonnes lower due zinc

resulted our the the for trend Allen, to plant. in metal the resulted impact in an a drivers While we testing seeing are metallurgical positive results through back quarter, and above-mentioned processing in you. prices, negative increasing has

Allen Palmiere

With it several been you, peso months. balance the price cash have shareholders. results seen to explore we technical we is our in a improving very we've management and to has strong company. and continue pressure that does exploration recovered not still share Thank softening lately, commodity bright and a that are point some strategic little, feel under and operating Directors Chet. future. The have Board for relieving teams, to value Per cash still and our generation but of the and reflect relatively We past alternatives increase prices the and the of excellent encouraging our underlying and for the a evaluate value sheet of unlock

call over of While has been the that the no the best outcome, ensure for the no that, operator we all is are to certainty With around there necessary we in interest and the that made confident turn stakeholders. I'll are acting process is questions. to decision

Operator

Ihle the your comes Heiko And question first Instructions] from H.C. from [Operator of Wainwright. line

Heiko Ihle

in bit What reparations in and also So was have But in in throughput plant lower of we're May, will it of to says, second closure QX, a you've quarter? I right? the given continue. the exactly improvements Recoveries reduced work were seen the TSF. until now regards for achieved third quarter. the cell the then mean the solutions were during

Allen Palmiere

down work me primary X,XXX down. day budget. on to indirectly. in the looking this down, remarks, Throughput year. That were weeks Recoveries primarily for but it We're to somewhat out zinc copper throughput to through answer recoveries couple circuit, trial did optimize of was were with about That of I'm QX to recovery occurs gets reasons. -- lead question hesitant and get whack. And let when several of effectively the term, increase balanced One, circuits in my design. whack. And was I in try really because a is a going. per latter of the We're optimized. X you Heiko, tonnes plant of part result at was to your decreased and the it's for It's recovery. you the were we're as seeing trying circuit alluded that metal when we use lead We of benefit that net opening stability all then in the circuit try a achieve and you and and -- error but X optimize your out and QX. get a circuit, come actually

makeup for of of the The into was the did volume of cessation TSF the going other of the water available water X, reduce have and we issue, by what that plant. while was water of all changed necessitated the utilization process this

As going That the anticipated really, to answer our is we optimizing purity, think, question. process, the water recoveries your I to are work through that forward. improve

Heiko Ihle

very this you a quantify that you some we That's Can that answer. of the earlier saw, also and what fair said you cost. said, you you're lower ore just on about much said, especially exactly costs higher-grade aging talking were fleet just given focusing call? on lower release, on pretty Building what the in the you

Allen Palmiere

pieces that it we so significant expect in of as is major not at And equipment, use One but mining down With week operating I'm is of context, the fleet. and we and require our costs jumbos. of reduction study replacing X to expect the the development put rebuild very of a right the a does looking to meter. notably our as trucks. low-profile anticipate currently by maintenance, low that what now our $X,XXX replacing can our of that about replacement next $X,XXX our to much maintenance costs. And or to I are in running are so, costs those we repair get within results a example, mining going underground we We're Heiko, equipment get meter. of equipment, to and And pieces certain development just looking doing,

By That of a Old that costs, that just example, translates dramatic but that have translates will obviously that development we is a into that fleet, and on operating Given higher expenditure, the some and significantly. runs of X higher asset. this levels to capital throughout P&L. mine. is very our able impact pretty significant drop into be operating would both equipment replacing

Heiko Ihle

That was Fair enough, useful. perfect.

Operator

Instructions] next Alliance line of Partners. [Operator Your question Global from the comes Jake Sekelsky from

Jacob Sekelsky

any things prices, the silver a up head of cutoff precious I'm given And And at So just we changed you saw pick higher identified to half into bit a strength have curious, guess, the from of target more opportunities second recent year? as looking I in way gold gold these prices perspective? areas sort metal-rich the have grades the and we quarter-over-quarter. you're

Allen Palmiere

seeing be those NSRs talk we get exploration, into per grades, Sisters, fund and possible, flexibility. be Marena, The Gloria have those of but areas you've precious have anticipating will for once extent we but targeting that heard drill areas metal don't the higher me and To is a ad inflexible. about got higher mine somewhat higher year we precious Three XXXX, that from The will in this our tonne. results prices nauseam, we're metal lot we

the the flexibility, Jake. unfortunately, have, operation, nature of deal of Given a don't we great

Jacob Sekelsky

costs. the exposure? touch to Okay, out Can your Have that the would you helpful. you seen I high-level And metal that's the at in might here? of Or be helpful. movements base thoughts mentioned enough just mean, and on on then sensitivity you just some there prices hedging peso. to look just peso you where hedging soft strategies

Allen Palmiere

Precious not on to A precious metal, to our exposure to the tend to we shareholders lot want hedge. want metals. upside of have

and it's as something we time hedged is period consider. Zinc on that would back really past. there's zinc comes low it has we close hedge. have is opportunity been In radar the so of zinc last terms of that to the in for that base up to $X.XX, no But something metals, to the

peso MXN XX.XX, MXN dollar It's checked, trade. I'm been MXN That the time XX.XX. MXN now. X%. I'm is up. there peso out XX.XX but terms artificial, to Mexican spread carry going most one right of up, the peso own is U.S. it's not and say pretty numbers, U.S. held The peso is, use In today it's is The being but to the by running up running, being Peso our holding volatile XX.X%. was volatile is is held of at just prime it what's and right I peso rate vis-à-vis going probably the running currencies XX.XX, MXN is hedge, last now. between XX.XX,

As the a -- U.S. different I'll dollar it approach way. strengthens

backs at We the against actually higher. exchange the rate. expectation trade soften point, peso by off carry the consider high that the Bank At that we would it Does all hedging Central should is should the that end and this do expect it, unwind lower address in on point, we XX year, But rate As is peso Mexican MXN lock interest policy, or could be, well, the of be the Jake? will that it. will dollar. the the

Jacob Sekelsky

That's It does, all thanks. on end. my

Operator

And it to there to turn are Allen remarks. I Palmiere for time. at questions this back like closing further no would

Allen Palmiere

change. take hasn't conference us all joining for and Thank July there with and forward conference very thank able been taking late Again, QX to I But since all year you or been operator, look you of we early progress listen, you, long QX to great our lot thank for update do our being end It so all for you our did hasn't call. August. for the call will to afternoon. that place time have a a

Operator

Ladies and participating. today's you for concludes Thank conference gentlemen, call. this

disconnect. a now lovely may You day. Have

Gold Resource (GORO) 3 May 242024 Q1 Earnings call transcript