EXK - Earnings call transcript Q2 2021

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Operator

Thank you for standing by. This is the conference operator. Welcome to the Endeavour Silver Corp. 2021 Second Quarter Financial Results Conference Call. [Operator Instructions] I would now like to turn the conference over to Galina Meleger, VP of IR for opening remarks. ahead. go Please

Galina Meleger

Chief Good Operating Silver operator. With and to West; the welcome on Chief Dickson; Thank Officer, Don Financial second morning, Gray. quarter Endeavour Christine company’s have we XXXX line our call. Officer, financial the Dan the our Chief you, and today, everyone Executive Officer, results me conference

may and information revenue information Before recoveries again do include Dickson. such future today’s securities Endeavour today’s assume call to I on and new update that than certain behalf law. to we obligation Dan other thank get statements anticipated not applicable expenditures to Endeavour’s started, regarding years, you for grades to timing over figures, of I We mineralized contain statements required am develop and within to forward-looking performance required laws. mines and any forward-looking required and in meaning gold I’d CEO, like production, of On the These to will it and joining intend remind you by as XXXX Silver, now silver the applicable turn And zones. do will and in cost call. including not

Dan Dickson

the good of Endeavour and Welcome second conference day, Galina the everyone. XXXX. call for Thanks, Silver to quarter

Before year the position company I to so want of dive this change into stage as we for growth. QX highlight far of one that results, I next leadership has been its

Silver’s development his past a significant our Brad Chief Christine a got Cooke making. May, plan future. and of management appointed Officer, succession into It the and expertise role in my career. announced has Endeavour represents aware, that seamless transition. important an in role colleague, are he This we Operating of part Also several Executive all was Chairman. investment the the in into of of of our Gray, years promoted over the the transformation West, you CEO, note, of I management As newly long was celebration stepped time to CFO; assume XX-year Don our role

in I of safety to So, of exceptional culture, areas we you on three first with CEO, key of seat goal ESG strategy, is and as shareholder that execute returns and with focus quarter our the deliver ultimately, profitability. my commitment assure and the can our

We are these already areas. in making significant progress

and On view and and in the governance ingrained operating as to a serving way continue At and our step way. of across action for regulators grow increased social catalysts be further important mandates with investors, is and drive industry safety the to host our new back corporate a positive environmental, to culture, the bringing culture initiatives. from charge business. take side, improvements I-Care and Endeavor, these me at stakeholders. Taquito and data rapid Demand issues a in and leadership should to a continues This the attitude philosophy pace, are

formalizing We anticipate currently strategy a in multiyear that are ESG fourth quarter. to we the release business

important landscape meaningful our on ahead This build will of sustainability our to achieve in evolving will especially and development this address for Terronera. the We be outcomes practices at stakeholders. decision a area existing

over the quarters control. profitability, next regarding focus of Lastly, be our will cost couple

this due in together the I last costs We part higher was year. we in constraints. global and reducing week chain and seeing the inflationary to industry-wide weathering put are plan supply pressures Mexico second for of a

are Mexico on yet the we of out not Beyond XX% the woods traditional of business faced, the fully pandemic. vaccinated. we more is risks

risks non-vaccinated poses COVID-XX country, particularly Delta are prevalent stakeholders. our and to So, employees the risks variant for

remains already risk the less than original protocols variant the place. in due However, to developed

our With QX their for control families regular employees will in second year. of internal and and up company-wide to vaccinations we let’s our currently campaign half and performance the Q&A. turn become then the are We a will testing open rolling for to it and out increase more that,

our this quarter than year. our stronger was release previous As performance news this financial morning, per

– was comparatively sale EBITDA to COVID-XX. million $X,XXX this mine $X However, ounces was almost constraints, Operating and we all-in and realized by shutdowns month fruition $X.X over our cost peso, of gold to sustaining due operations XXXX operating increased consolidated of release of in silver strengthening government comparative of half inflationary profile, exhaustion our up to company’s from the Cash costs due is to $X.X to to budget. were ounce QX the and at of almost Year-on-year, to up the cost. increased prevent El tracking than $XX.X meet period. in Curso. ability XX,XXX cash global million ahead see and today’s speaking, of for of a mandated revenue X.X on working silver higher should our We that year. costs at from per the gold Mexican XXX% consolidated at and development second QX on revenue our cost basis, an creating increased the reported for supply Compas under will of almost ounces not charges is – net our totaling until impacted million. a production of XXX% When excluding million the quarter increased million The a by XXX% operation noted On million of XX% the year-on-year for earlier $XX.X the before $X million the ounces Terronera were for sales be and half price guidance up quarterly $X.X production. now of payments mining come higher gold payable small million royalty earnings labor cost year just $XX of the here spread the capital cash chain for in mine intended costs be than material ounce up share and Cubo management of costs of El in and the transaction earnings ounce or silver in marketable Cubo We payments the high-grade a annual price average $X.X to metal royalty to On production $XX.X This gold. of gold $XX.X QX. contingent sustaining of operating and on was guidance realized up $XX.X communicated will sale to was year-to-date for costs, silver impact to future. on in less metrics. Guanacevi basis, the It El April pressures, mine earnings This of strengthened by increased all-in of per significantly in comes of net is this stream, million, to than in costs earnings both resulted Guanacevi, Mexico. flow were close million million of at Compas of El the XXXX. news $X sale in obviously per quarterly should X.X per on silver, million representing cash totals share. equivalent costs budget $X After the annual our during adjusted in amounted with that operations profile alone to QX. securities million, first exceed ounce reserves. million we bridge operating Notwithstanding our the were overall per our guidance or due X% Cubo, Mexican announced silver $XX.XX year-on-year $XX silver, This at the Particularly were suspend in our year. equates the were and $XX.XX and in the El closed gain gain higher year. quarterly of

to $XXX talented be creation suspension we transfer project on expect individuals positive opportunities. track to this million, the we This will a potential company us value operations the note, management the Terronera. balance that incurred financing. Compas robust at of facilitate to half The very debt construction to of over long-term will Terronera minimal remainder our El is to Bolañitos should be within year. cost in be And $X.X anticipated some the that help have evaluating the a the million of year in our meantime, the of ahead of later are and On cash with decision ultimately ability entering sheet our various estimated balance year. second We

Moving our will production. is performer to and top on Guanacevi of mines, XX% our produce consolidated over

throughput At declining grades And Bolañitos, in higher and the quarter-over-quarter areas the offset a the tons during processed the by focused suspension. grades lastly, QX, quarter. on are and Compas, plan multiple planned Belen production developing we During at is were production lower Melladito in vein quarter plan. the exceeding vein, the ahead preparation production and From drill standpoint, in both where during targets. production higher of expanding planned as than annual have higher of slightly resulted

So, overview we we that’s of half costs confident in year. the our are to reduce and and implement brief a the them second we will recognize HX have we the operations of in in improvements

ounces In is on forecasting our X is terms of last published XX of years. permitted. our Terronera. next and to production our The be year Terronera study million is over project We silver core outlook, growth over pre-feasibility attention the fully slated development-ready annual equivalent asset.

exploration final Subsequent of de-risk Canamex, QX, exploration order, the that’s to a say now that evaluating the we acquire the a we potentially any heap a during as gold time, stage announced advance to this development end production. an discuss following in after also Gold ahead host to vote – Nevada final gold acquisition shareholder and of trade an asset our that a the to for cease to our layered webcast Terronera. construction. could plans asset, the The currently Endeavor vote. the an and be will potential in under the look stages from to into use that alternatives quarter our Several update that on results. the project years advanced will the feasibility I of Bruner viewed provide we can this study opportunistic detailed remain will model CTO, asset At with be for this QX. asset the will potential released and leach on work agreement end growth also to we ideas plan company a feasibility completing are start study of We final financing project we

work Q&A. to up Endeavor and operator, conclude and times open executive closing, position our For and to I’d silver am employees and the to Mexico forward agenda. company. In our business this like looking growth we I continue to be our Silver our with in exciting remain are confident reason, these and for the for team, partners through Board, With strategy, leading our that, financial focus.

Operator

go Please Partners. first you. [Operator The Jake Sekelsky question with Global Instructions] from ahead. Thank comes Alliance

Jake Sekelsky

my Hey, taking and team. Dan Thanks for questions.

Dan Dickson

Hey, Jake.

Jake Sekelsky

So are options. a guess an as just you color see down an what winding do saw looking likely goes? the and like as I range month, Compas outcome you on likely Do on Cubo timeline as sale think know of we here? looking I with we this at this at see outright any far what outcome to more of most front you’re

Dan Dickson

Yes, lot for sure, From I provide there. Jake. of can’t a timeline, color a

I be groups district. early worked days well us. exploration We in that Cubo there in are that out the remain which would VanGold, be have that acquirer, but for the now would that same there And same is And remains yet. talked in for El time, Compas, the But exploration and lot really as case with Silver well out ideally, for Compas. is is at district. a the a number opportunities And of of opportunity ultimately, we that worked say, Guanajuato interested

little but more a plant, require would that metals of We properties, nonetheless a have refurbishment. bit some the not refurbishment, refurbishment base amount of other huge

time, So, and this can can forward. continue that all an I exploration push Compas at we in opportunity much it’s pretty But we various say standpoint. from alternative have to do point El

Jake Sekelsky

again I Okay. were just were down this just I price in metals withhold inventory, just this if you environment that? slightly That’s for was the or am guess mean, helpful. And QX. is on higher then where strategic I curious some your thoughts decision on shipments to we what sale in of from are a the more timing the to goods finished or related inventory

Dan Dickson

Yes.

continue have you and goods of to, end balance. we alluded that finished As hold we QX our the at balance to built

of QX, actually I the $XX value $XX value fair think the of about we market end And the at about fair – million. market is end million. that the was at QX,

we And long-term finished in ultimately, So, what and we the had we And fair and value fall. from on goods. come a price of end a still believe in expect ultimately, that short-term cash, back in market of the to standpoint, we we dispose actually do prices goods that is silver higher we of gold. expect QX. need dip, at when And the Friday saw what finished the we those will

Jake Sekelsky

Got it. makes sense. That

all Thanks end. that’s Okay, again. my on

Dan Dickson

Thanks, Jake.

Operator

The with from Heiko H.C. Ihle next Wainwright. question ahead. comes go Please

Heiko Ihle

for well. my you taking Hope are questions. doing? Thanks are How doing you

Dan Dickson

you Hope are well. well Heiko. Thanks, as doing

Heiko Ihle

I am fine.

– industry-wide masks mentioned color you global the to and provide the it stuff in in you the there equivalent would this mean, hear almost tires – can supply that particular have on you now. of earlier ago? XX say just things be would You rumors that and pressures mean, that call. days bit lead to chain supplies. I you but get anything been have little see differed long Can is cleaning supply how right year that I some maybe decent I importantly, assume having a on things a like hard ago, pretty equipment a about most? particular as being I concern times, seems answer

Dan Dickson

Sure.

our think construction the of is right biggest I concern Terronera. phase going into now

with to in year. inputs key costs vein all asset are underground huge and big development pits we we QX. So, we saw have are and reagents, significant are open years big cost are there. opposed flocculants to supplies seeing us next a increases mining us and being X vein in steel we Terronera a within part for Those to some huge cost as or costs want things it We is seeing and are where our basically do to – not be being the for Terronera big the Other cyanide, increases ultimately ultimately, this going and increase we such were slightly tires construction a to tires us, we have that not decision and and seeing that the some build costs.

and where also seeing going some second on spots the some Ultimately, sourced think here we more come more geologists asks space cost their are that their salaries that we year. and are that’s have engineers to happening the for and that’s what’s of constraints impact We to control we supply with to geologists, our going the see half and through. engineers in increases what and is starting

payments the production bonuses saw XXXX, outsourcing profit happened One come through is QX in change things in what of Mexico PTU other we rules. the payments, that in from is sharing Mexico. Also the

So, work to that all of employees be employees have company the they for.

QX which ultimately, us are the We have But to us make across inputs that transition well. across in a the here as we additional will in rest of in us impact and world impact concerned bit inflation that little second cost seeing QX QX. we almost the the quarter, story all and cash are that

Heiko Ihle

then I drilling you And Got in the meters, that or your it. a meters Paloma something. assets. any just clarification, that’s I in MD&A, Chile bit was a in you and by million a quick think on breakdown Page XX country it at noticed basis, $X.X actually of for than higher And quite other spending are of per the drilling. meter only X,XXX activity

I I And curiosity, any of with? scale. a more missing of getting out obvious a operate sum talking you drilling would don’t a But to such and is work different there? expensive temporary is given purely think we if to just mine something or trouble aware small Paloma area this here. and of or there I hard access. be unions of know, is ultimately economies this money are expenses just So Am do about am

Dan Dickson

question. Yes. fair it’s No, a very

expensive. was It expensive right. that that would and be are budgeted Paloma drilled we more always year. is You more this

of into be a too did built work some that would surface of that also lot cost. We

it’s segment been from assets expensive. at So for expensive It’s an of into think what cost be that we is class-sized a doing the an expensive from Aida are be standpoint. operating Cerro we in changers built basis at that looking have and more pit, permitting being more right for a you that but we But is it drilling money, also game And more open that reading, itself would permitting Marquez world Endeavour. Chile are fact you underground would some be again, that in much Chile would on are standpoint.

Heiko Ihle

in will you, I get good. guys. back Very Thank queue.

Dan Dickson

Heiko. Thanks, appreciated. Much

Operator

Please Cosmos ahead. next with The Chiu question CIBC. comes go from

Cosmos Chiu

Hi, Dan thanks and team.

Dan Dickson

Hey, Cosmos, how it is going?

Cosmos Chiu

are Hi, Dan. How you doing?

Dan Dickson

Good. How are you?

Cosmos Chiu

Good. on higher ounce My cost. your what you also was expected. $XX over you MD&A is first I had as cost an question guess, mentioned in than

inflation about that has could like efficiencies that that am some QX into you have the It am of been the and sound trying just numbers? in half more QX leak numbers, everything how into since pressures wondering, you even have being in cost be if am inflationary seen And pressures your just that to QX captured is talked or pressure reflected also wondering second to have going of doesn’t pressure were You QX? here. in reflected as and I cost much I QX I your just offset figure out, well? into improved by QX, in QX continuing not more numbers? say, cost the

Dan Dickson

Yes. a question. No, fair that’s

in, production won’t and Our QX up those yet. pressures inflationary goal show just QX. for for we’re costs is July July and results came waiting in

QX what be speak But seeing expectation I contained far. we’re so will to is So QX. our is here those can’t in costs

or for be some that fourth So two this it and is relatively quarter next salary some royalty profiles, a production we and prices in increases and and – aspect today, resulted to stuff the in they we’ve PTUs, same. we’ve quarter. are at bonuses, expect the changeover in $X labor of to in the cost obviously, with costs flow bonuses And quarters, the Again, all down. looked we cost with that where increases. QX on through projected royalty at communicated saw won’t costs. come will And of out Ultimately, big that third always the our then those we

The other thing was we at did operating Guanacevi that happened a lot in development. QX of and

area development QX through into call ultimately, or El we flow So in expense that Porvenir, we that won’t an QX.

So to the quarter. our we third expect profile cost lower in be

Cosmos Chiu

your I sustaining $XX an then for you’ve year confirm, well of And because great. to the quarter guidance into ounce, right? maintained on to $XX the fourth costs Okay, guess as cost

Dan Dickson

have we this Yes, changed not at guidance time.

Cosmos Chiu

feasibility expected the is up you Okay, following Terronera go-ahead QX at great. that. on decision a and Maybe after mentioned, as costs, study potentially by

in there Mexico rules those been in in is you – inflationary As well see changes inflationary how decision that you here How mitigate on pressures you And of potentially risk? that feasibility factors some country. Mexico, in about to you your recent your the factor how impacting Terronera? talked into can study? And subcontracting as the going do are

Dan Dickson

Wood, come from I inflationary feasibility fair side rely initial our of is we and us, costs very Obviously, see the into inclusion How It’s Yes. get they CapEx. decision that, move we’re standpoint exceptional hired And study being we’ve to mitigate pressure but the to from to an forward. that. construction determine cost on can against going on it’s the think to if question. going to to are what a we’re able we’re seeing through what study, see to going pre-feasibility an increases. be feasibility ultimately group for And

producer that and a a I producer. are, think we’re gold a silver partly we as company

will on prices see that the pressures back across up the showing be the we gold of eventually inflation it. end silver and any world effectively, So in

can will So sense. that the that store get construction of I And we’re going better. on think mitigated be ultimately, in kind

it CapEx really or going the month initial see our out Woods say, the and I next you’re inflationary and I so. pressures, we teams As and hopefully, to and come in with consider in that think

Cosmos Chiu

that acquisitions? difficult project, seems for Great. Dan, it Gold find talk like is Two telling one good me part it And is And you to a new guess here, in metal. just really it last the about then two, you’re acquiring that is the I of first that new silver from Can terms strategy? number country, assets Canamex. us bit more question Bruner questions.

Dan Dickson

want silver a of We’ve I I it primary that. world, byproduct will Yes. XX% with Fortuna metal mines. mines a And concerned was a production. difficult. above comes move assets necessarily say with most which silver is It move into we strategic of There and base is jurisdiction most with Nevada. not is and new is Roxgold, recently, scarcity the from The other seen difficult. We than of maintain to obviously idea our silver the production space acquired a that we’re gold in or into XX% [indiscernible] gold mean, Sherritt silver whole a Nevada, gold lot silver world-class is mines see The into and jurisdiction. opportunistic a obviously or Canyon. more

We’re value. we takes to we to lot want there, do We comes XX%, to gold, revenue vote but is like value. a way not of quick for after looking And ultimately, shareholder and Bruner add hopefully, we more and not add detail. lot. kind more always of not like and from concerned with assets. in two a some it out we come assets about but Canamex silver silver gold, an XX% saw can silver to There And to agreement talk we acquire gold. a some just are our from a are and there

Cosmos Chiu

Dan. That’s again. Thanks I Thanks, questions have. all Great. the

Dan Dickson

questions. Good Cosmos. Thanks,

Operator

next go Partners. Please comes from ahead. The ROTH question Joseph Capital with Reagor

Joseph Reagor

for questions. and Dan Hi, my thanks taking team,

Dan Dickson

to you. No problem, hear Joseph, nice from

Joseph Reagor

Yes.

you So I different related expense QX ore therefore, to not Can mentioned some body it. like. us kind what were specifically, but – that give of to of the to the you looked on an for that’s On things, an in that idea had in some you side reserves, and cost development the continue guys guess question. to bit Guanacevi little of MD&A sorry costs a of maybe

over we have And – development more back how of for of many to out numbers? for going much you’re year? expenses it the maybe the could cost kind how So also rest the non-reserve of

Dan Dickson

Yes.

Ultimately, be We will Curso QX ore under chose said, out El part no to be just spent Santa there. accessing in of so here that IFRS some want mine under Porvenir, upper El just of rules, El is at El an there development, So able acquisition. drop We about $XXX,XXX. ultimately and Milache, effectively Porvenir we’re that in the as area because it’s Sur. we and and that expense mining Cruz now, QX Curso $XXX,XXX to and area reserves of like I to

I more QX wouldn’t that So expect much in from area. or QX

Joseph Reagor

items Okay. Were other there that any items the QX one-time in numbers? like Guanacevi

Dan Dickson

We Yes. and our bonus. true-up sharing had profit of

PTU second of we of So to about amount PTU, ultimately production and $XXX,XXX year-end quarter, paid Guanacevi in amounted to in $XXX,XXX. the bonus a we finalized $XXX,XXX top-up had which a we that to similar

Joseph Reagor

Okay.

as if if QX high thing from just the better I’m can it you Guanacevi production gold made than Like annual Second QX end. raise Should color the might be is the your give guys how you would QX to what was guidance about specifically for that and QX, so are being – gold assets above looking as look guys first you those we guidance? the half, double Bolañitos, be lower whatever we at – than guys you tracking just far guidance, should decide at that thinking like much expected. you didn’t

Dan Dickson

Guanacevi in raise COVID. Obviously, to plan. Yes. weren’t right We the phenomenal around guidance grades what at with QX from time we out grade expected a standpoint at this was Guanacevi of ready due and just QX to

been that has little grades a the were dip in on But planned but much QX, those in than a see point standpoint silver so left plan. be to think our on plan. weren’t grades QX to is raising year this ultimately we have we no for of slightly will see a grades there from bit higher the tonnage Bolañitos, plan, expectation Bolañitos production QX in At now. a and or what in in QX Guanacevi gold bit half closer and I been with at Ultimately, improve the year. and compared second lower might just time guidance at we comfortable the here

Joseph Reagor

Okay.

about tonnage, COVID concern potential on more say fair So not of it’s is grade. to on impact your

do grade to the remain steady? So you expect

Dan Dickson

Yes.

Joseph Reagor

Okay.

for you the related of Terronera Okay. And final financing million $XXX to you then it additional the you guys the some cash to equity end looks guys like off plans one feel thing, quarter, plus with funded investments are subsequent well Any that in side? ATM have of you form finished the equity had. do on or the you that any

Dan Dickson

keep side. position, of Obviously, our cash great this and $XX the with between for the in the of number and add the we’ve with been and last million a X $XX $XX form balance months, sheet come groups say, is well are million, to to drive funding said – We funded million so a may help million other $XXX that along. project somewhere to on and working we’ve our balance equity in for financing opportunities

Joseph Reagor

it I Okay, sounds Thanks. over. good. will turn it

Dan Dickson

Thanks, Joseph. Good questions.

Operator

ahead. The next question comes go Please from Lucas Pipes with Securities. B. Riley

Unidentified Analyst

asking is question Lucas. for actually This a here [indiscernible]

of you me. in was precious silver XXXX. you all wondering of the We’ve strength and at I a half kind XX lot commodity even for surprises do prices or precious going the obviously Just metals gold have metals pricing over largely but kind if macro decreased. this a last performance of in question and seen second months, of where in quick lagged see

Dan Dickson

the in now Yes. that XX I surprise the I mean, space guess, right for years, isn’t word.

we’re think I silver And past. Right And correction. in think of ratio bit, ratio. to XX:X. down one now, Fridays of days, tough that see ultimately seen a sideways is to ways those And was of deal gold be get next for balance I sheets with kind here. we’ve there little just do haven’t not to sitting in changed. we’re is we’re back still think gold it’s Ultimately, deal a expect balance to to but I it, year. And to with long-term, here going I the government’s for fall and we have those the XX:X it but of are. government into where The inflation their be to lot to up going and going pick with and think a impact sheets is inflation I

can I silver to see we to give forward, when going ultimately, gold but never line be of happen. and So going a that’s time higher

based decisions we we’re to see silver what make add down the on long-term and up silver price of So price spectrum. into a market more can our our look see portfolio into Terronera kind continue and if all to long-term and and the going gold on be we

Unidentified Analyst

very And coming as see be share the you That’s to profile guys coming if you going mentioned what to you the it. was kind avenues able to that over your the helpful, of ESG the you. easiest years. wondering publish you’d ESG I are thank in improve months. Got kind report of

Dan Dickson

Yes. year. ESG actually that eighth report in strategy. I report one mean not It’s our it’s and a area improve. We can did specific then we an this report we sustainability May,

partly think it’s culture continue standpoint. I a from to improve

I specifically different. all to look do that are that in their really is reduce going there going the try continue over us and And to look standpoint. the and a stuff no to at. best manage things companies are X, going from governance to job that in footprint think changing X to And world. Terronera we’re going do at the next that internally years carbons how practice But to mining footprint, world, be gives to we’re good a we opportunity be have to some to and our to carbon

to hopefully a in X then the get space and So credit a can the on and on improve hopefully next we leader over to we be years, X it. it that report

Unidentified Analyst

Best me. luck helpful. moving of forward. all That’s for it. That’s Got

Dan Dickson

Matt. Thanks,

Operator

from next The ahead. with question BMO. go Thompson Please Ryan comes

Ryan Thompson

Hi, updates. the for thanks Dan,

Bolañitos, my but questions a I’ll most I one on got little think just term. asked, bit maybe longer of ask

than be look resource be at they seem Just the of how should in grade. reserve higher about and both to thinking inferred, that mine. grades I M&I we When sort the

So closer of and plan that be mine thinking grades little bit could into talk resource those safe to converting of how material couple think Is if asset moving should about reserve to just the be about that the of up grades? a you sort sort years? just next we that it would for

Dan Dickson

working Metadito, areas this a still the more But now we’ve can grades We more mine deeper of the and has see gold, Yes. body we to going blended we’re to do open drill have online be getting be drilling been And of silver ideal. back that would kind grade the in this around now, on one dynamics are trying silver variations deposits. some silver less quarter with into lower we more Belen grades to come aspect. Because as right we some to ore and to ultimately, But that seeing areas up results out up. Bolañitos, silver we XXs, get earlier get some more But good get we’re right faces we’ve come gold. be hovering grades. and that year. XXs X.X to been X, able gold put expect we’re we to up that in more the just if the that get – at we’re next ultimately,

Ryan Thompson

the Okay. update. That’s helpful. Thanks for

Dan Dickson

Thanks, Ryan.

Operator

[Operator Instructions] The next Markets. question Capital Reichman comes from with Mark Noble go Please ahead.

Mark Reichman

mixed is in Thank about of market of the you. a the lot There messages trajectory inflation.

the of about the that of Terronera CFO, thinking do an the time ahead changing think about kind And basis? project supplies you, I feasibility locking of in about to that that inputs of Dan, former this wanted managing third you terms in as-needed how into How So in quarter. terms is on as in how the versus go you’re report? coming study out ask

Dan Dickson

touched and foresight initial put due Yes. from team earlier. our to engineering ultimately be and mean, to to a to I we that the I think cost and that standpoint what this of able group impact are in inflation see pressure and going our going I to we’re see, the seeing and CapEx costs. in kind of is Ultimately, part increase, on you’re

As don’t gold obviously inflation hedge to of in natural ahead or need ourselves that to in, that way think is we’re far lock supply I a we costs get locking business as the costs. in and

no other different XX% Terronera. U.S. is existing dollar as at The that cost the significant structure three portion vein is XX% that’s labor. to of the our Mexican assets, the aspect peso an underground at our miner. and depreciated A is against to labor

and think relatively gold do dollars. terms standpoint, costs if we cost that see against the same I pressures an higher labor costs length than do expect ultimately, can there at rather Terronera over but blips, years. in Nothing XX, probably long-term And take So for from we ultimately, focus on world. to the is got be short-term Terronera that we’ve time, short-term XX, of will you’ll stay of And that runaway be silver to U.S. see hedge we is to XX going in our in the inflation help and us short-term.

to look over at buying best do and can decision, point, lock we prices course, as we that have comes of the on everything will those few we years, we this when next strategy to how can. upfront. But no it well construction in Now our

Mark Reichman

second have And a big company. profile, – you on the can focused this what cost how half, you’re for where some then – achieve? know do earlier. you of reduction I is think about second a be that do on is, you the and may think to your talked Terronera variables and you what But you of do going But much in do the And the optimizing key of in touched terms operating you Okay. to question that? change are really this think

Dan Dickson

write-off aspect get-go’s key The labor. the

in on I acquired in QX will lot acquiring we we’ve of be touched – through using one-time a that the QX then But Guanacevi. and that here items also As QX. supplies rolled

taking expectations will costs the $XX costs the ultimately, It’s all year, all-in bit what going is hit our etcetera. So in, our not we sustaining we’re particular there somewhere am to to here our item that be I thing. in hit of able the and at and lock a in no grades saw the It’s Guanacevi, the that out able on-time be etcetera, everything. to of tonnage out, we we’re across almost us beginning we We were And to to what’s to to confident costs, Bolañitos year. that in $XX little ensuring of transportation one get is key it’s in that those our everything, second the line range. trying everything. half hit The cost

Mark Reichman

very you. thank helpful. Okay, That’s

Dan Dickson

good Mark, Thanks, questions.

Operator

This concludes Dan the Endeavour remarks. Silver question-and-answer Dickson, session. closing I would like to turn for any the conference to back of CEO over

Dan Dickson

catalysts to going cost It’s double and and to our is biggest for Thanks, operator, take Terronera. and for production everybody the today. I of it one our big half. company going the know be to I in our the call profile profile ultimately joining want and cut thank aspect

big will company. coming together study and the a for us. of webcast we the feasibility the So importance ahead expect as quarter feasibility final We we out have putting this be do of it’s study that quarter, to be a

soon, the for So you and thank again can all hopefully, we questions. talk

Operator

call. conference today’s concludes This

you disconnect for pleasant day. lines. Thank a may and You participating, have your

Endeavour Silver (EXK) 10 Aug 212021 Q2 Earnings call transcript