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6-K

Hudbay Minerals Inc. (HBM)

6-K 2024-11-14 For: 2024-09-30
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Added on April 08, 2026

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2024

Commission File Number: 001-34244

HUDBAY MINERALS INC. (Translation of registrant’s name into English)

25 York Street, Suite 800 Toronto, Ontario M5J 2V5, Canada (Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F [   ]                    Form 40-F [X]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [   ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [   ]

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes [   ]                     No [X]

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- _____________________________

EXPLANATORY NOTE

On November 13, 2024, Hudbay Minerals Inc. (“Hudbay”) filed on the Canadian Securities Administrators’ System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedarplus.ca the following documents: (1) Unaudited Condensed Consolidated Interim Financial Statements for the period ended September 30, 2024, (2) Management's Discussion and Analysis for the period ended September 30, 2024, (3) News Release dated November 13, 2024, (4) Form 52-109F2 Certification of Interim Filings Full Certificate - CEO, (5) Form 52-109F2 Certification of Interim Filings Full Certificate - CFO.

Copies of the filings are attached to this Form 6-K and incorporated herein by reference, as follows:

  • Exhibit 99.1 — Unaudited Condensed Consolidated Interim Financial Statements for the period ended September 30, 2024
  • Exhibit 99.2 — Management's Discussion and Analysis for the period ended September 30, 2024
  • Exhibit 99.3 — News Release dated November 13, 2024
  • Exhibit 99.4 — Form 52-109F2 Certification of Interim Filings Full Certificate - CEO
  • Exhibit 99.5 — Form 52-109F2 Certification of Interim Filings Full Certificate - CFO

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

HUDBAY MINERALS INC.
(registrant)
By: /s/ Eugene Lei
Name: Eugene Lei
Title: Chief Financial Officer

Date: November 13, 2024

EXHIBIT INDEX

The following exhibits are furnished as part of this Form 6-K:

Exhibit Description
99.1 Unaudited Condensed Consolidated Interim Financial Statements for the period ended September 30, 2024
99.2 Management's Discussion and Analysis for the period ended September 30, 2024
99.3 News Release dated November 13, 2024
99.4 Form 52-109F2 Certification of Interim Filings Full Certificate - CEO
99.5 Form 52-109F2 Certification of Interim Filings Full Certificate - CFO 
Hudbay Minerals Inc.: Exhibit 99.1 - Filed by newsfilecorp.com

Unaudited Condensed Consolidated Interim Financial Statements

(In US dollars)

HUDBAY MINERALS INC.

For the three and nine months ended September 30, 2024 and 2023

HUDBAY MINERALS INC.<br>Condensed Consolidated Interim Balance Sheets<br>(Unaudited and in thousands of US dollars)
Sep. 30, Dec. 31,
--- --- --- --- --- --- --- ---
Note 2024 2023
Assets
Current assets
Cash and cash equivalents $ 443,273 $ 249,794
Short-term investments 7 40,000 -
Trade and other receivables 8 246,983 203,429
Inventories 9 196,643 207,334
Prepaid expenses and other current assets 10,426 6,289
Other financial assets 10 2,128 4,102
Taxes receivable 576 2,300
940,029 673,248
Receivable 8 12,029 12,157
Inventories 9 16,453 24,450
Other financial assets 10 10,064 7,089
Intangibles and other assets 11 47,221 52,453
Property, plant and equipment 12 4,273,553 4,316,006
Deferred tax assets 134,964 151,946
Goodwill 73,762 75,285
$ 5,508,075 $ 5,312,634
Liabilities
Current liabilities
Trade and other payables $ 260,364 $ 239,149
Taxes payable 57,274 53,441
Other liabilities 13 36,508 30,035
Other financial liabilities 14 52,807 42,235
Gold prepayment liability 15 - 55,901
Lease liabilities 16 26,634 28,902
Deferred revenue 18 72,096 87,672
505,683 537,335
Other financial liabilities 14 93,148 51,720
Lease liabilities 16 41,688 61,433
Long-term debt 17 1,108,900 1,287,536
Deferred revenue 18 320,298 330,848
Pension obligations 1,261 6,010
Other employee benefits 102,076 101,849
Environmental and other provisions 19 313,994 321,912
Deferred tax liabilities 382,135 407,152
2,869,183 3,105,795
Equity
Share capital 21b 2,630,105 2,240,233
Reserves 31,290 30,177
Retained earnings (123,550 ) (173,599 )
Equity attributable to owners of the Company 2,537,845 2,096,811
Non-controlling interest 101,047 110,028
$ 5,508,075 $ 5,312,634
Commitments (note 24)
HUDBAY MINERALS INC.<br>Condensed Consolidated Interim Statements of Income (Loss)<br>(Unaudited and in thousands of US dollars, except per share amounts)
---
Note Three months ended<br>September 30, Nine months ended<br>September 30,
--- --- --- --- --- --- --- --- --- --- --- --- ---
2024 2023 2024 2023
Revenue 6a $ 485,773 $ 480,456 $ 1,436,282 $ 1,087,841
Cost of sales
Mine operating costs 248,535 260,304 762,544 622,191
Depreciation and amortization 6b 97,452 113,753 304,371 269,845
345,987 374,057 1,066,915 892,036
Gross profit 139,786 106,399 369,367 195,805
Selling and administrative expenses 12,040 10,128 47,064 27,874
Exploration expenses 12,242 4,746 30,785 18,307
Other expenses 6c 7,858 8,885 35,331 27,738
Re-evaluation adjustment - environmental provision 19 1,969 (32,436 ) (5,985 ) (45,368 )
Results from operating activities 105,677 115,076 262,172 167,254
Net interest expense on long term debt 6d 16,217 21,078 53,885 55,885
Accretion on streaming arrangements 6d 6,000 6,597 18,176 19,694
Change in fair value of financial instruments 6d 3,741 (950 ) 23,913 4,560
Other net finance costs 6d 18 4,202 18,306 16,267
Net finance expense 25,976 30,927 114,280 96,406
Earnings before tax 79,701 84,149 147,892 70,848
Tax expense 20 29,347 38,659 99,380 34,833
Net earnings for the period $ 50,354 $ 45,490 $ 48,512 $ 36,015
Attributable to:
Owners of the Company $ 49,762 $ 45,125 $ 55,537 $ 35,650
Non-controlling interest 592 365 (7,025 ) 365
Net earnings for the period $ 50,354 $ 45,490 $ 48,512 $ 36,015
Net earnings per share attributable to owners
Basic and diluted $ 0.13 $ 0.13 $ 0.15 $ 0.12
Weighted average number of common shares outstanding:
Basic 22 393,604,853 346,720,425 370,992,994 293,970,111
Diluted 22 394,236,661 346,987,162 371,504,904 294,240,698
HUDBAY MINERALS INC.<br>Condensed Consolidated Interim Statements of Cash Flows<br>(Unaudited and in thousands of US dollars)
---
Three months ended <br>September 30, Nine months ended <br>September 30,
--- --- --- --- --- --- --- --- --- --- --- --- ---
2024 2023 2024 2023
Net earnings for the period $ 50,354 $ 45,490 $ 48,512 $ 36,015
Other comprehensive income:
Item that will be reclassified subsequently to net earnings:
Recognized directly in equity:
Net gain (loss) on translation of foreign currency balances 8,608 (20,913 ) (14,430 ) (14,288 )
8,608 (20,913 ) (14,430 ) (14,288 )
Items that will not be reclassified subsequently to net earnings:
Recognized directly in equity:
Gold prepayment revaluation 4,355 96 4,339 (92 )
Tax effect (1,149 ) (26 ) (1,145 ) 24
Remeasurement - actuarial (loss) gain (2,976 ) 3,943 12,911 1,792
Tax effect (295 ) 1,006 (2,875 ) 659
(65 ) 5,019 13,230 2,383
Other comprehensive income (loss) net of tax, for the period 8,543 (15,894 ) (1,200 ) (11,905 )
Total comprehensive income for the period $ 58,897 $ 29,596 $ 47,312 $ 24,110
Attributable to:
Owners of the Company 57,509 31,518 56,293 26,032
Non-controlling interest 1,388 (1,922 ) (8,981 ) (1,922 )
Total comprehensive income for the period $ 58,897 $ 29,596 $ 47,312 $ 24,110
HUDBAY MINERALS INC.<br>Condensed Consolidated Interim Statements of Cash Flows<br>(Unaudited and in thousands of US dollars)
---
Note Three months ended September 30, Nine months ended September 30,
--- --- --- --- --- --- --- --- --- --- --- --- --- ---
2024 2023 2024 2023
Cash generated from operating activities:
Net earnings for the period $ 50,354 $ 45,490 $ 48,512 $ 36,015
Items not affecting cash:
Tax expense 20 29,347 38,659 99,380 34,833
Depreciation and amortization 6b 97,884 114,099 305,671 270,838
Share-based compensation 6e 3,354 2,212 17,942 4,112
Net finance expense 6d 25,976 30,927 114,280 96,406
Inventory adjustments 9 1,599 - 1,599 906
Amortization of deferred revenue and variable consideration 6a (9,565 ) (16,797 ) (44,302 ) (50,829 )
Pension and other employee benefit payments, net of accruals 3,843 1,840 9,077 5,721
Amortization of community agreements 2,864 1,688 10,947 4,922
Re-evaluation adjustment - environmental obligation 19 1,969 (32,436 ) (5,985 ) (45,368 )
Write-down/loss on disposal of PP&E 2,182 - 13,284 890
Decommissioning and restoration payments (448 ) (48 ) (798 ) (1,167 )
Net payments on settlement of non-QP hedges (2,017 ) - (3,620 ) -
Other 25a (225 ) (187 ) (3,879 ) (12,724 )
Taxes paid (20,795 ) (3,467 ) (106,219 ) (21,089 )
Operating cash flow before change in non-cash working capital 186,322 181,980 455,889 323,466
Change in non-cash working capital 25b (40,144 ) (30,032 ) (31,553 ) (75,682 )
146,178 151,948 424,336 247,784
Cash used in investing activities:
Acquisition of property, plant and equipment (98,326 ) (69,230 ) (250,192 ) (200,044 )
Community agreements (2,374 ) (2,801 ) (6,343 ) (7,446 )
Grants received 12 - - 2,400 -
Cash and cash equivalents acquired in acquisitions, net of cash paid 4, 5 - 270 - 10,959
Net (purchase) sale of investments (246 ) - (246 ) 53
Proceeds from disposition of property, plant and equipment - 5 - 655
Short-term investments 7 - - (40,000 ) -
Interest received 5,079 3,509 10,419 6,579
(95,867 ) (68,247 ) (283,962 ) (189,244 )
Cash (used in) generated from financing activities:
Proceeds from/(repayment) of revolving credit facility 17b - 90,000 (100,000 ) 130,000
Repurchase of senior unsecured notes, net of discount 17a (48,149 ) - (81,920 ) -
Principal repayments - Nordic Bonds 17c - (83,307 ) - (83,307 )
Premium paid on Nordic Bonds 17c - (833 ) - (833 )
Equity issuance, net of transaction and share issuance costs 4, 21b - - 386,195 (188 )
Interest paid on long-term debt (921 ) (1,944 ) (37,447 ) (33,819 )
Financing costs (2,868 ) (4,900 ) (10,281 ) (11,056 )
Lease payments 16 (7,611 ) (7,953 ) (23,500 ) (18,384 )
Equipment financing payments (3,985 ) - (7,149 ) -
Gold prepayment repayments 15 (16,812 ) - (62,244 ) (6,428 )
Change in restricted cash 844 (2,221 ) 844 (2,221 )
Deferred Rosemont acquisition payment (10,000 ) (5,000 ) (10,000 ) (10,000 )
Net proceeds from exercise of stock options and warrants 122 15 2,475 123
Dividends paid 21b (2,897 ) (2,555 ) (5,488 ) (4,463 )
(92,277 ) (18,698 ) 51,485 (40,576 )
Effect of movement in exchange rates on cash 1,472 480 1,620 1,588
Net (decrease) increase in cash and cash equivalents (40,494 ) 65,483 193,479 19,552
Cash and cash equivalents, beginning of the period 483,767 179,734 249,794 225,665
Cash and cash equivalents, end of the period $ 443,273 $ 245,217 $ 443,273 $ 245,217
HUDBAY MINERALS INC.<br>Condensed Consolidated Interim Statements of Changes in Equity<br>(Unaudited and in thousands of US dollars)
---
Share capital<br>(note 21) Other capital<br>reserves Foreign currency<br>translation reserve Remeasurement<br>reserve Retained<br>earnings Total Non-<br>controlling<br>interest Total equity
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Balance, January 1, 2023 $ 1,780,774 $ 58,503 $ (14,759 ) $ (17,206 ) $ (235,503 ) $ 1,571,809 $ - $ 1,571,809
Net earnings - - - - 35,650 35,650 365 36,015
Other comprehensive (loss) income - - (12,001 ) 2,383 - (9,618 ) (2,287 ) (11,905 )
Total comprehensive (loss) income - - (12,001 ) 2,383 35,650 26,032 (1,922 ) 24,110
Contributions by and distributions to owners:
Dividends (note 21b) - - - - (4,463 ) (4,463 ) - (4,463 )
Shares issued on acquisition of Copper Mountain, net of share issuance costs (note 4) 436,499 - - - - 436,499 106,976 543,475
Shares and warrants issued on acquisition of Rockcliff (note 5) 12,503 725 - - - 13,228 - 13,228
Stock options - 1,455 - - - 1,455 - 1,455
Issuance of shares related to stock options exercised 189 (65 ) - - - 124 - 124
Total contributions by and distributions to owners 449,191 2,115 - - (4,463 ) 446,843 106,976 553,819
Balance, September 30, 2023 $ 2,229,965 $ 60,618 $ (26,760 ) $ (14,823 ) $ (204,316 ) $ 2,044,684 $ 105,054 $ 2,149,738
Net earnings - - - - 30,717 30,717 2,811 33,528
Other comprehensive income (loss) - - 21,352 (10,856 ) - 10,496 2,163 12,659
Total comprehensive income (loss) - - 21,352 (10,856 ) 30,717 41,213 4,974 46,187
Contributions by and distributions to owners:
Flow-through shares issued, net of share issuance costs (note 21b) 10,166 - - - - 10,166 - 10,166
Stock options - 682 - - - 682 - 682
Issuance of shares related to stock options exercised 102 (36 ) - - - 66 - 66
Total contributions by and distributions to owners 10,268 646 - - - 10,914 - 10,914
Balance, December 31, 2023 $ 2,240,233 $ 61,264 $ (5,408 ) $ (25,679 ) $ (173,599 ) $ 2,096,811 $ 110,028 $ 2,206,839
HUDBAY MINERALS INC.<br>Condensed Consolidated Interim Statements of Changes in Equity<br>(Unaudited and in thousands of US dollars)
---
Share capital<br>(note 21) Other capital<br>reserves Foreign currency<br>translation reserve Remeasurement<br>reserve Retained<br>earnings Total Non-<br>controlling<br>interest Total equity
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Balance, January 1, 2024 $ 2,240,233 $ 61,264 $ (5,408 ) $ (25,679 ) $ (173,599 ) $ 2,096,811 $ 110,028 $ 2,206,839
Net earnings - - - - 55,537 55,537 (7,025 ) 48,512
Other comprehensive (loss) income - - (12,474 ) 13,230 - 756 (1,956 ) (1,200 )
Total comprehensive (loss) income - - (12,474 ) 13,230 55,537 56,293 (8,981 ) 47,312
Contributions by and distributions to owners:
Dividends (note 21b) - - - - (5,488 ) (5,488 ) - (5,488 )
Shares issued on equity raise, net of share issuance costs 386,195 - - - - 386,195 - 386,195
Stock options - 1,559 - - - 1,559 - 1,559
Issuance of shares related to stock options and warrants exercised 3,677 (1,202 ) - - - 2,475 - 2,475
Total contributions by and distributions to owners 389,872 357 - - (5,488 ) 384,741 - 384,741
Balance, September 30, 2024 $ 2,630,105 $ 61,621 $ (17,882 ) $ (12,449 ) $ (123,550 ) $ 2,537,845 $ 101,047 $ 2,638,892
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

1. Reporting entity

Hudbay Minerals Inc. ("HMI" or the "Company") is a company existing under the Canada Business Corporations Act. The address of the Company's principal executive office is 25 York Street, Suite 800, Toronto, Ontario. The unaudited condensed consolidated interim financial statements ("financial statements") of the Company for the three and nine months ended September 30, 2024 and 2023 represent the financial position and the financial performance of the Company and its subsidiaries (together referred to as "Hudbay").

Wholly owned subsidiaries as at September 30, 2024 included HudBay Peru Inc., HudBay Peru S.A.C. ("Hudbay Peru"), HudBay (BVI) Inc., Hudbay Arizona Inc., Copper World, Inc. ("Copper World") and Mason Resources (US) Inc. ("Mason"). On January 1, 2024, the Company amalgamated with Copper Mountain Mining Inc., Hudbay British Columbia Inc. and Rockcliff Metals Corp. ("Rockcliff") and continued carrying on business as Hudbay Minerals Inc. Following the amalgamation, the Company directly holds a 75% interest in Copper Mountain Mine (BC) Ltd. ("CMBC") and is the direct holder of all of Rockcliff's mineral properties. Mitsubishi Materials Corporation ("MMC"), an arms-length party, owns the remaining 25% interest in CMBC.

Hudbay is a diversified mining company with long-life assets in North and South America. Hudbay's operations in Cusco (Peru) produce copper with gold, silver and molybdenum by-products. Hudbay's operations in Manitoba (Canada) produce gold with copper, zinc and silver by-products. Hudbay's operations in British Columbia (Canada) produce copper with gold and silver by-products. Hudbay has a development pipeline that includes copper development projects in Arizona and Nevada (United States), and a focused growth strategy on exploration, development, operation, and optimization of properties that Hudbay already controls, as well as other mineral assets that Hudbay may acquire that fit the Company's strategic criteria. The Company is governed by the Canada Business Corporations Act and its shares are listed under the symbol "HBM" on the Toronto Stock Exchange, New York Stock Exchange and Bolsa de Valores de Lima.

2. Basis of preparation

(a)  Statement of compliance:

These interim financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB") and do not include all of the information required for full annual financial statements by International Financial Reporting Standards ("IFRS") as issued by the IASB.

These interim financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2023 which includes information necessary or useful to understanding the Company's business and financial statement presentation. In particular, the Company's material accounting policies are presented as note 3 in the Company's audited consolidated financial statements for the year ended December 31, 2023 and have been consistently applied in the preparation of these interim financial statements, in addition to the new standard noted below.

The Board of Directors approved these interim financial statements on November 12, 2024.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(b)  Use of judgements and estimates:

The preparation of the interim financial statements in conformity with IFRS requires Hudbay to make judgements, estimates and assumptions, in applying accounting policies that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim financial statements, as well as reported amounts of revenue and expenses during the reporting period. Actual results may differ from these judgements, estimates and assumptions. The interim financial statements reflect the judgements and estimates outlined by Hudbay in its audited consolidated financial statements for the year ended December 31, 2023.

3. New standards

New standards and interpretations adopted

Amendment to IAS 1 - Presentation of Financial Statements

The amendments to IAS 1 clarify that only covenants with which an entity is required to comply on or before the reporting date affect the classification of a liability as current or non-current. In addition, an entity has to disclose information in the notes that enables users of financial statements to understand the risk that non-current liabilities with covenants could become repayable within twelve months. Classification is unaffected by the expectations that the entity will exercise its right to defer settlement of a liability. Lastly, the amendments clarify that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets. The amendments are effective for annual periods beginning on or after January 1, 2024. The amendments have been adopted by the Company and the amendments did not result in any changes to the interim financial statements.

4. Acquisition of Copper Mountain Mining Corporation

On June 20, 2023, Hudbay acquired all of the issued and outstanding common shares of Copper Mountain Mining Inc. (formerly, Copper Mountain Mining Corp., and referred to herein as "Copper Mountain"), as part of a court-approved plan of arrangement. At the time, Copper Mountain held 75% of CMBC, the entity that owns 100% of the Copper Mountain mine. MMC owns the remaining 25% interest in CMBC as a non-controlling interest.

As a result of the acquisition, Hudbay obtained control of Copper Mountain on June 20, 2023.

Management determined that the assets and processes comprised a business and therefore accounted for the transaction as a business combination, using the acquisition method of accounting.

Consideration transferred:

The purchase consideration paid by Hudbay was for 100% of the net assets of Copper Mountain and their 100% owned subsidiaries ("100% owned entities") and a 75% ownership in CMBC. The aggregate purchase consideration for the acquired assets, net of the liabilities assumed is as follows:

Equity instruments (84,165,617 common shares of Hudbay) $ 436,687
Cash 3,794
Consideration transferred - June 20, 2023 $ 440,481

The fair value of the common shares issued was based on Hudbay's listed share price of C$6.87 at the June 20, 2023 acquisition date. Immediately prior to the acquisition, Copper Mountain settled its outstanding restricted share units and performance share units through the issuance of shares and settled its stock options for replacement Hudbay options that were immediately settled in cash.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

Hudbay incurred acquisition related costs of $6,932 during the nine months ended September 30, 2023, mainly relating to external legal and advisory fees and due diligence costs, which were recorded in other expense in the condensed consolidated interim income statements. In addition, Hudbay incurred share issuance costs of $188 and presented these as a deduction from share capital.

Identifiable assets acquired and liabilities assumed:

The fair value of the net assets was determined using a combination of market, income and cost methods. The fair value of the non-controlling interest was then computed at a 25% of the equity interest in CMBC.

The following presents the allocation of the final purchase price, resulting in recognized fair value amounts of identifiable assets acquired and liabilities assumed as follows:

Fair value of net assets acquired / (liabilities) assumed Final
Cash and cash equivalent $ 14,483
Trade and other receivables 19,110
Inventories 47,875
Prepaid expenses 3,096
Other financial assets 8,495
Property, plant and equipment 434,821
Mineral properties 369,000
Inventories - low grade stockpile 6,000
Trade and other payables (77,111 )
Advances from Hudbay (3,421 )
Lease liabilities (34,617 )
Other financial liabilities (9,550 )
Long-term debt (144,981 )
Environmental and other provisions (12,702 )
Deferred tax liabilities (148,246 )
Total fair value of net identifiable assets acquired $ 472,252

The fair values of mineral properties, low grade stockpile and other property, plant and equipment have been determined based on an independent valuation, using a combination of market, income and cost methods. In particular, the fair values of the mineral properties and low grade stockpile have been calculated using significant judgements and estimates.

Trade receivables acquired as part of the acquisition have a fair value of $8,764 which is equal to their gross contractual value. Other receivables acquired have a fair value of $10,346 which is equal to their gross contractual value. Trade and other receivables are expected to be collected during the next 12 months.

Hudbay provided advances to Copper Mountain prior to the acquisition date, which have been recorded as a purchaser loan.

Hudbay recognized goodwill as a result of the acquisition as follows:

Final
Total consideration transferred $ 440,481
Non-controlling interest 106,976
Less: value of net identifiable assets acquired (472,252 )
Goodwill upon acquisition at June 20, 2023 $ 75,205
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

The goodwill balance arose from the requirement to record deferred income tax liabilities measured at the tax effect of the difference between the fair values of the assets acquired and liabilities assumed and their tax bases. None of the goodwill recognized is expected to be deductible for income tax purposes.

The results of operations have been consolidated with those of the Company from the date of acquisition and included in the British Columbia operating segment.

5. Acquisition of Rockcliff Metals Corporation

On September 14, 2023, Hudbay acquired all of the issued and outstanding common shares of Rockcliff, as part of a court-approved plan of arrangement. In doing so, Hudbay obtained control of Rockcliff on September 14, 2023.

Management determined that substantially all of the fair value of the gross assets acquired is concentrated in the Talbot exploration property and therefore accounted for the transaction as an asset acquisition.

The purchase consideration paid was 2,675,324 Hudbay common shares and 517,460 Hudbay warrants. For asset acquisitions settled with equity, entities are required to record the net assets acquired based on the fair value of the assets received in exchange for the equity issued, unless that fair value cannot be estimated reliably. Hudbay incurred acquisition related costs of $518 during the third quarter of 2023, mainly relating to external legal and advisory fees and due diligence costs, which were capitalized and included as a cost of acquiring the net assets.

The fair value of the net assets acquired was determined using a combination of income and cost methods. In particular, the fair values of the exploration property have been calculated using significant judgements and estimates. The following presents the fair value amounts of identifiable assets acquired and liabilities assumed:

Fair value of net assets acquired / (liabilities) assumed Final
Cash and cash equivalents $ 270
Accounts receivable and prepaid expenses 98
Property, plant & equipment 33
Exploration property 14,198
Accounts payable and accrued liabilities (305 )
Advance from Hudbay (548 )
Total fair value of net identifiable assets acquired $ 13,746
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

6. Revenue and expenses

(a) Revenue

Hudbay's revenue by significant product types:

Three months ended<br>September 30, Nine months ended<br>September 30,
2024 2023 2024 2023
Copper $ 261,227 $ 334,159 $ 805,741 $ 704,120
Gold 176,371 128,430 474,027 279,245
Zinc 24,244 17,781 54,677 57,871
Silver 12,725 10,264 35,801 23,806
Molybdenum 16,832 22,350 51,034 58,157
Other 8 - 481 239
Revenue from contracts 491,407 512,984 1,421,761 1,123,438
Non-cash streaming arrangement items ^1^
Amortization of deferred revenue - gold 4,239 10,161 26,114 23,435
Amortization of deferred revenue - silver 5,326 6,636 22,037 22,509
Amortization of deferred revenue - variable<br>consideration adjustments - prior periods - - (3,849 ) 4,885
9,565 16,797 44,302 50,829
Pricing and volume adjustments ^2^ 6,003 (16,443 ) 41,647 (8,379 )
506,975 513,338 1,507,710 1,165,888
Treatment and refining charges (21,202 ) (32,882 ) (71,428 ) (78,047 )
$ 485,773 $ 480,456 $ 1,436,282 $ 1,087,841
^1^See note 18.
^2^Pricing and volume adjustments represent mark-to-market adjustments on initial estimate of provisionally priced sales, realized and unrealized changes to fair value of quotational pricing hedge derivative contracts and adjustments to originally invoiced weights and assays.

Consideration from the Company's stream agreements is considered variable (note 18). Gold and silver stream revenue can be subject to cumulative adjustments when the amount of precious metals to be delivered under the contract changes. As a result of changes in the Company's mineral reserve and resource estimate in the first quarter of 2024, the amortization rate by which deferred revenue is drawn down into income was adjusted and, as required, a variable consideration adjustment was made for all prior year stream revenues since the stream agreement inception date. This variable consideration adjustment for the nine months ended September 30, 2024 resulted in a decrease in revenue of $3,849 (nine months ended September 30, 2023 - increase in revenue of $4,885).

(b) Depreciation and amortization

Depreciation of property, plant and equipment and amortization of intangible assets are reflected in the condensed consolidated interim statements of income as follows:

Three months ended<br>September 30, Nine months ended <br>September 30,
2024 2023 2024 2023
Cost of sales $ 97,452 $ 113,753 $ 304,371 $ 269,845
Selling and administrative expenses 432 346 1,300 993
$ 97,884 $ 114,099 $ 305,671 $ 270,838
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

(c) Other expenses

Three months ended<br>September 30, Nine months ended <br>September 30,
2024 2023 2024 2023
Regional costs $ 803 $ 843 $ 3,644 $ 2,915
Write-down/loss on disposal of PP&E 2,182 - 13,284 890
Amortization of community costs (other assets) 1,538 362 7,052 1,056
Copper Mountain related acquisition costs (note 4) - 180 - 6,932
Restructuring - 2,297 1,193 2,297
Care & maintenance - Manitoba 3,912 4,463 10,729 13,070
Evaluation costs 274 55 998 162
Reduction of obligation to renounce flow-through share expenditures (note 21b) (1,980 ) - (2,972 ) -
Option agreement proceeds (Marubeni) - - (363 ) -
Other 1,129 685 1,766 416
$ 7,858 $ 8,885 $ 35,331 $ 27,738

The Arizona business unit held an option to acquire water rights and land, which expired during the first quarter of 2024 without being extended or exercised. The previously capitalized cost to maintain the option, net of accrued interest, of $8,133 is presented as part of write-down of PP&E.

On March 7, 2024, Hudbay and Marubeni Corporation executed an option agreement whereby Marubeni will fund certain minimum annual exploration expenditures for agreed upon properties. During the nine months ended September 30, 2024, proceeds of $363 were received and recorded as other income.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(d) Net finance expense ****

Three months ended<br>September 30, Nine months ended September 30,
2024 2023 2024 2023
Net interest expense on long-term debt
Net interest expense on long-term debt $ 16,217 $ 21,078 $ 53,885 $ 55,885
Accretion on streaming arrangements (note 18)
Additions 6,000 6,597 18,000 19,790
Variable consideration adjustments - prior periods - - 176 (96 )
6,000 6,597 18,176 19,694
Change in fair value of financial instruments
Gold prepayment liability (note 15) 5,271 (2,745 ) 10,682 2,222
Unrealized loss on non-quotational pricing hedges 223 - 12,006 -
Realized loss on non-quotational pricing hedges 2,124 - 4,674 -
Investments (3,877 ) 1,795 (3,449 ) 2,338
3,741 (950 ) 23,913 4,560
Other net finance costs
Net foreign exchange (gain) loss (3,318 ) (614 ) 3,602 1,130
Accretion on community agreements measured at amortized cost 1,098 804 3,684 2,358
Accretion on environmental provisions 2,746 2,618 8,013 7,236
Accretion on Wheaton refund liability 150 139 450 417
Withholding taxes 469 1,596 2,186 4,577
Loss on disposal of investments 113 15 113 667
Other finance expense 3,786 3,071 11,181 6,436
Interest income (5,026 ) (3,427 ) (10,923 ) (6,554 )
18 4,202 18,306 16,267
Net finance expense $ 25,976 $ 30,927 $ 114,280 $ 96,406

Other finance expense relates primarily to standby fees on Hudbay's revolving credit facilities and leases.

Commencing in the first quarter of 2024, Hudbay has entered into copper forward sales, copper costless collars and gold costless collars which are non-quotational pricing ("QP") contracts (note 23b). Subsequent movements in the fair value of non-QP contracts are recognized in change in fair value of financial instruments in the condensed consolidated interim statements of income.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(e) Share-based compensation expense

Three months ended<br>September 30, Nine months ended<br>September 30,
2024 2023 2024 2023
Cost of sales $ 322 $ 149 $ 1,285 $ 287
Selling and administrative expenses 2,793 1,934 15,828 3,673
Other expense 239 129 829 152
$ 3,354 $ 2,212 $ 17,942 $ 4,112

Share-based compensation expense included within cost of sales, selling and administrative expenses, and other expenses relates to deferred share units, restricted share units, performance shares units and the Company's stock option plan. The increase in share-based compensation expense during the three and nine months ended September 30, 2024 primarily relates to change in the Company's share price.

7. Short-term investments

Short-term investments include guaranteed investment certificates held with Canadian financial institutions. We currently hold two $20,000 guaranteed investment certificates that mature in March 2025 and June 2025, respectively.

8. Trade and other receivables

Sep. 30, 2024 Dec. 31, 2023
Current
Trade receivables $ 220,424 $ 169,806
Statutory receivables 20,184 27,215
Other receivables 6,375 6,408
246,983 203,429
Non-current
Taxes receivable 12,029 12,157
$ 259,012 $ 215,586
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

9. Inventories

Sep. 30, 2024 Dec. 31, 2023
Current
Stockpile $ 27,723 $ 52,454
Finished goods 66,411 61,266
Materials and supplies 102,509 93,614
196,643 207,334
Non-current
Stockpile 687 9,591
Low grade stockpile^1^ 5,889 5,875
Materials and supplies 9,877 8,984
16,453 24,450
$ 213,096 $ 231,784
^1^Stockpile of inventory that is not expected to be processed until the end of the Copper Mountain mine life.

The cost of inventories recognized as an expense, including depreciation, and included in cost of sales amounted to $301,991 and $942,182 for the three and nine months ended September 30, 2024, respectively (three and nine months ended September 30, 2023 - $333,138 and $803,604, respectively).

During the three and nine months ended September 30, 2024, Hudbay recognized an expense of $1,599 in cost of sales primarily related to write-down of the carrying value of certain long term inventory supplies (three and nine months ended September 30, 2023 - $nil and $906, respectively).

10. Other financial assets

Sep. 30, 2024 Dec. 31, 2023
Current
Derivative assets $ 1,095 $ 1,416
Collateral deposit (note 17b) 629 722
Restricted cash 404 1,964
2,128 4,102
Non-current
Investments at fair value through profit or loss 10,064 6,452
Collateral deposit - 637
10,064 7,089
$ 12,192 $ 11,191
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

11. Intangibles and other assets

Intangibles and other assets of $47,221 (December 31, 2023 - $52,453) includes $43,770 of other assets (December 31, 2023 - $48,428) and $3,451 of intangibles (December 31, 2023 - $4,025).

Other assets represent the carrying value of certain future community costs that relate to original agreements with communities for the Constancia operation which allow Hudbay to extract minerals over the useful life of the Peru operation. The liability remaining for these costs is recorded in agreements with communities recorded at amortized cost (note 14). Amortization of the carrying amount is recorded in the condensed consolidated interim statements of income within other expenses (note 6c) or exploration expenses, depending on the nature of the agreement.

Intangibles mainly represent computer software costs.

12. Property, plant and equipment

Sep. 30, 2024 Cost Accumulateddepreciationandamortization Carryingamount
Exploration and evaluation assets 99,053 $ - $ 99,053
Capital works in progress 847,263 - 847,263
Mining properties 2,599,728 (1,231,911 ) 1,367,817
Plant and equipment 3,341,697 (1,489,810 ) 1,851,887
Plant and equipment-ROU assets1 263,588 (156,055 ) 107,533
7,151,329 $ (2,877,776 ) $ 4,273,553
Dec. 31, 2023 Cost Accumulated<br>depreciation<br>and<br>amortization Carrying<br>amount
Exploration and evaluation assets 96,901 $ - $ 96,901
Capital works in progress 804,020 - 804,020
Mining properties 2,481,118 (1,093,839 ) 1,387,279
Plant and equipment 3,262,854 (1,345,604 ) 1,917,250
Plant and equipment - ROU assets1 253,344 (142,788 ) 110,556
6,898,237 $ (2,582,231 ) $ 4,316,006
1 Includes 4,592 of capital works in progress - ROU assets (cost) that relate to the Arizona segment (December 31, 2023 - 4,800 related to the Arizona segment).

All values are in US Dollars.

During the first quarter of 2024, Hudbay received a grant of $2,400 from the Environment and Climate Change Canada related to the purchase of an electric mining shovel in the third quarter of 2023. The carrying amount of the shovel has been deducted by the amount of the grant received. The grant will be recognized in profit or loss over the life of the shovel as a reduced depreciation expense. There were no significant unfulfilled conditions attached to the grant.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

13. Other liabilities

Sep. 30, 2024 Dec. 31, 2023
Unearned revenue $ - $ 616
Environmental and other provisions (note 19) 31,519 22,292
Pension liability 1,101 3,284
Other employee benefits 3,888 3,843
$ 36,508 $ 30,035

14. Other financial liabilities

Sep. 30, 2024 Dec. 31, 2023
Current
Derivative liabilities $ 21,481 $ 11,811
Equipment financing 12,835 3,300
Deferred Rosemont acquisition consideration - 9,713
Agreements with communities recorded at amortized cost 18,491 17,411
52,807 42,235
Non-current
Equipment financing 44,144 7,499
Agreements with communities recorded at amortized cost 41,892 37,568
Wheaton refund liability 7,112 6,653
93,148 51,720
$ 145,955 $ 93,955

Agreements with communities recorded at amortized cost relate to agreements with communities near the Constancia operation which allow Hudbay to extract minerals over the useful life of the Constancia operation, carry out exploration and evaluation activities in the area and provide Hudbay with community support to operate in the region.

The movement in the deferred Rosemont acquisition consideration was driven by the repayment of the full outstanding consideration amount.

Equipment financing represents agreements that Hudbay has entered into to purchase mining equipment. Hudbay owns the assets and finances the payment of these assets over the specified term. These agreements expire between 2024 and 2029 with interest rates between 3.25% and 7.55% per annum. During the nine months ended September 30, 2024, $43,869 (September 30, 2023 - nil) of capital additions related to the recognition of property, plant and equipment that has been financed (note 25).

As part of the streaming agreement for the 777 mine, Hudbay must repay, with precious metals credits, the stream deposit by August 1, 2052, the expiry date of the agreement. If the stream deposit is not fully repaid with precious metals credits from 777 production by the expiry date, a payment for the remaining amount will be due at the expiry date of the agreement. As the 777 mine has concluded all mining activities following the depletion of reserves and finalized the sales of produced concentrate, Hudbay concluded that the remaining stream deposit will not be repaid by means of precious metals credits from 777 production. The repayment amount is recorded as a Wheaton refund liability, which is and will be discounted at the 9.0% rate inherent in the original 777 stream agreement and accreted over the remaining term of the agreement.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

15. Gold prepayment liability

Gold prepayment liabilities are reflected in the condensed consolidated interim balance sheets as follows:

Sep. 30, 2024 Dec. 31, 2023
Current $ - $ 55,901

The following table summarizes changes in the gold prepayment liability:

Balance, January 1, 2023 $ 71,208
Change in fair value recorded in statement of earnings 11,223
Change in fair value recorded in other comprehensive income 192
Repayments (26,722 )
Balance, December 31, 2023 $ 55,901
Change in fair value recorded in statements of loss (note 6d) 10,682
Change in fair value recorded in other comprehensive income (4,339 )
Repayments (62,244 )
Balance, September 30, 2024 $ -

During the third quarter of 2024, the Company completed the final delivery and the obligation for the gold prepayment liability.

16. Lease liabilities

Balance, January 1, 2023 $ 61,019
Acquired through the acquisition of Copper Mountain 34,617
Additional capitalized leases 21,401
Lease payments (25,216 )
Derecognized leases (685 )
Accretion and other movements (801 )
Balance, December 31, 2023 $ 90,335
Additional capitalized leases 10,254
Lease payments (23,500 )
Derecognized leases (11,516 )
Accretion and other movements 2,749
Balance, September 30, 2024 $ 68,322

Lease liabilities are reflected in the condensed consolidated interim balance sheets as follows:

Sep. 30, 2024 Dec. 31, 2023
Current $ 26,634 $ 28,902
Non-current 41,688 61,433
$ 68,322 $ 90,335
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

Hudbay has entered into leases which expire between 2024 and 2037. The interest rates on leases which were capitalized have interest rates between 2.50% and 8.49%, per annum. The lease term range of interest rates utilized for discounting depends mostly on Hudbay acting as a lessee and duration of the lease. For certain leases, Hudbay has the option to purchase the equipment and vehicles leased at the end of the terms of the leases. Hudbay's obligations under these leases are secured by the lessor's title to the leased assets. The present value of applicable lease payments has been recognized as an ROU asset, which was included as a non-cash addition to property, plant and equipment, and a corresponding amount as a lease liability.

There are no restrictions placed on Hudbay by entering into these leases.

The following outlines expenses recognized within the Company's condensed consolidated interim statements of income, relating to leases for which a recognition exemption was applied.

Three months ended September 30, Nine months ended September 30,
2024 2023 2024 2023
Short-term leases $ 2,186 $ 1,745 $ 4,805 $ 4,090
Low value leases 106 136 277 385
Variable leases 3,751 9,112 17,701 20,326
Total $ 6,043 $ 10,993 $ 22,783 $ 24,801

Payments made for short-term, low value and variable leases would mostly be captured as expenses in the condensed consolidated interim statements of income, however, certain amounts may be capitalized to PP&E for the Arizona segment during its development phase and certain amounts may be reported in inventories given the timing of sales. Variable payment leases include equipment used for heavy civil works at Constancia.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

17. Long-term debt

Long-term debt is comprised of the following:

Sep. 30, 2024 Dec. 31, 2023
Senior unsecured notes (a) $ 1,110,563 $ 1,190,586
Senior secured revolving credit facilities (b) (1,663 ) 96,950
$ 1,108,900 $ 1,287,536

(a) Senior unsecured notes

Balance, January 1, 2023 $ 1,188,132
Accretion of transaction costs and premiums 2,454
Balance, December 31, 2023 $ 1,190,586
Repurchases (82,598 )
Write-down of unamortized transaction costs 615
Accretion of transaction costs and premiums 1,960
Balance, September 30, 2024 $ 1,110,563

As at September 30, 2024, $1,117,402 aggregate principal amount of senior notes were outstanding in two series: (i) a series of 4.50% senior notes due 2026 ("2026 Notes") in an aggregate principal amount of $575,017 and (ii) a series of 6.125% senior notes due 2029 ("2029 Notes") in an aggregate principal amount of $542,385. During the quarter, the Company repurchased and retired $13,364 of the 2026 Notes and $35,097 of the 2029 Notes at a discount. As of September 30, 2024, the Company repurchased and retired a total of $24,983 of the 2026 Notes and $57,615 of the 2029 Notes at a discount. For the three and nine months ended September 30, 2024, the discount of $312 and $678, respectively, was recorded as Other expenses in the condensed consolidated interim statements of income.

Upon the repurchase and retirement of $82,598 of senior unsecured notes, the unamortized transaction costs related to this principal amount were recorded as a finance expense in the condensed consolidated interim statements of income.

The senior notes are guaranteed on a senior unsecured basis by substantially all of the Company's subsidiaries, other than HudBay (BVI) Inc. and certain excluded or unrestricted subsidiaries, which includes CMBC (the Company's 75% owned subsidiary that owns the Copper Mountain mine), and subsidiaries that hold the Copper World and Mason projects as well as any newly formed or acquired subsidiaries that primarily hold or may develop non-producing mineral assets that are in the pre-construction phase of development.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(b) Senior secured revolving credit facilities

Balance, January 1, 2023 ^1^ $ (3,970 )
Proceeds from drawdown, net of repayments 100,000
Accretion of transaction costs 1,627
Transaction costs (707 )
Balance, December 31, 2023 $ 96,950
Repayments (100,000 )
Accretion of transaction costs 1,476
Transaction costs (89 )
Balance, September 30, 2024 ^1^ $ (1,663 )
^1^ Balance, representing deferred transaction costs, is in an asset position.

Hudbay has two senior secured revolving credit facilities with total commitments of $450 million and substantially similar terms and conditions for its Canadian and Peruvian businesses, with maturity on October 26, 2025. Hudbay's revolving credit facilities are secured against substantially all of the Company's assets, other than those associated with the Copper World and Mason projects.

During the nine months ended September 30, 2024, Hudbay repaid $10,000 under its Canadian revolving credit facility and $90,000 under the Peruvian revolving credit facility.

As at September 30, 2024, there were nil draws under the Canadian and Peruvian revolving credit facilities.

As at September 30, 2024, the Peru segment had nil in letters of credit issued under the Peru revolving credit facility to support its reclamation obligations and the Manitoba segment had $25,615 in letters of credit issued under the Canadian revolving credit facility to support its reclamation and pension obligations. As at September 30, 2024, we were in compliance with our covenants under the revolving credit facilities.

Surety bonds

The Arizona segment had $18,383 in surety bonds issued to support future reclamation and closure obligations. No cash collateral is required to be posted under these surety bonds.

The British Columbia segment had $48,644 in surety bonds issued to support future reclamation and closure obligations and $4,911 in surety bonds with BC Hydro in relation to the BC Hydro transmission system at the Copper Mountain Mine. No cash collateral is required to be posted under these surety bonds.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

Other letters of credit

The Peru segment had $126,126 in letters of credit issued with various Peruvian financial institutions to support future reclamation and other operating matters. No cash collateral is required to be posted under these letters of credit.

The British Columbia segment had $629 in letters of credit issued with various Canadian financial institutions related to other operating matters. Cash collateral deposit has been posted under these letters of credit (note 10).

Hudbay has a C$130.0 million bilateral letter of credit facility ("LC Facility") with a major Canadian financial institution. As at September 30, 2024, the Manitoba segment had $56,133 in letters of credit issued under the LC Facility to support its reclamation and pension obligations.

(c) Copper Mountain Bonds

On April 9, 2021, Copper Mountain completed an offering of $250,000 of secured bonds ("the Bonds"). The Bonds provided the bondholders with the right to put all or part of the principal amount of the outstanding Bonds to Copper Mountain at a price of 101%, plus accrued interest, following a change of control events. With the acquisition of Copper Mountain on June 20, 2023, the change of control event was triggered and all outstanding Bonds were available to be put to Copper Mountain within a predefined period of time immediately following the acquisition date.

The change in control put option expired on July 17, 2023, at which time, $83,307 of the Bonds were put to Copper Mountain. The principal and premium amounted to $84,140, which was repaid on July 24, 2023.

18. Deferred revenue

Peru Stream Agreement

For the three and nine months ended September 30, 2024, the drawdown rates for the Peru stream agreement for gold and silver were $817 and $14.56 per ounce, respectively (year ended December 31, 2023 - $820 and $15.26 per ounce, respectively).

The following table summarizes changes in deferred revenue:

Balance, January 1, 2023 $ 469,538
Amortization of deferred revenue
Liability drawdown (72,424 )
Variable consideration adjustments - prior periods (4,885 )
Accretion on streaming arrangements
Current year additions 26,387
Variable consideration adjustments - prior periods (96 )
Balance, December 31, 2023 $ 418,520
Amortization of deferred revenue (note 6a)
Liability drawdown (48,151 )
Variable consideration adjustments - prior periods 3,849
Accretion on streaming arrangements (note 6d)
Current year-to-date additions 18,000
Variable consideration adjustments - prior periods 176
Balance, September 30, 2024 $ 392,394
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---

Consideration from the Company's stream agreement is considered variable. Gold and silver stream revenue can be subject to cumulative adjustments when the number of ounces to be delivered under the contract changes. As a result of changes in the Company's mineral reserve and resource estimate in the first quarter of 2024, the amortization rate by which deferred revenue is drawn down into income was adjusted and, as required, a current period variable adjustment was made for all prior period stream revenues since the stream agreement inception date. This variable consideration adjustment resulted in a decrease in revenue of $3,849 and an increase of finance expense of $176 for the nine months ended September 30, 2024 (year ended December 31, 2023 - increase in revenue of $4,885 and a decrease of finance expense of $96).

Deferred revenue is reflected in the condensed consolidated interim balance sheets as follows:

Sep. 30, 2024 Dec. 31, 2023
Current $ 72,096 $ 87,672
Non-current 320,298 330,848
$ 392,394 $ 418,520

19. Environmental and other provisions

Reflected in the condensed consolidated interim balance sheets as follows:

Sep. 30, 2024 Decommissioning,restoration andsimilar liabilities Deferredshare units Restrictedshare units Performanceshare units Other ^1^ Total
Current (note 13) $ 4,469 $ 13,770 $ 5,756 $ 2,340 $ 5,184 $ 31,519
Non-current 306,166 - 3,232 3,387 1,209 313,994
$ 310,635 $ 13,770 $ 8,988 $ 5,727 $ 6,393 $ 345,513
Dec. 31, 2023 Decommissioning,<br>restoration and<br>similar liabilities Deferred<br>share units Restricted<br>share units Performance<br>share units Other ^1^ Total
Current (note 13) $ 1,370 $ 8,660 $ 2,147 $ 727 $ 9,388 $ 22,292
Non-current 313,971 - 2,941 1,853 3,147 321,912
$ 315,341 $ 8,660 $ 5,088 $ 2,580 $ 12,535 $ 344,204
^1^ Relates primarily to flow-through share premiums, restructuring costs and other non-capital provisions.

Decommissioning and restoration obligations ("DRO") are remeasured at each reporting date to reflect changes in discount rates, exchange rates, and timing and extent of cash outflows which can significantly affect the liabilities. This provision has been recorded based on estimates and assumptions that management believes are reasonable; however, actual decommissioning and restoration costs may differ from expectations.

During the nine months ended September 30, 2024, the Company recorded a non-cash gain of $5,985 in the condensed consolidated interim statements of income mainly related to a revaluation adjustment to the Flin Flon environmental reclamation provision. The re-evaluation adjustment was impacted by an increase in long term, risk-free real discount rates based on changes in Canadian bond yields. Typically, an operating location will reflect any revaluation adjustments to the environmental reclamation provision against its reclamation assets. However, as the Flin Flon operations closed in June 2022, the corresponding Flin Flon assets have been fully depreciated and cannot be reduced below residual value resulting in the remaining impact being recorded as a gain in the condensed consolidated interim statements of income.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

As at September 30, 2024, decommissioning, restoration and similar liabilities have been discounted to their present value at rates ranging from 2.69% to 4.54% per annum (December 31, 2023 - 3.01% to 4.86%), using pre-tax, risk-free interest rates that reflect the estimated maturity of each specific liability.

During the nine months ended September 30, 2023, the Company recorded a non-cash gain of $45,368 in the condensed statements of income mainly related to a revaluation adjustment to the Flin Flon environmental reclamation provision.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

20. Income and mining taxes

The tax expense is applicable as follows:

Three months ended September 30, Nine months ended September 30,
2024 2023 2024 2023
Current:
Income tax expense $ 11,830 $ 33,465 $ 67,796 $ 43,141
Mining tax expense 14,345 7,727 37,868 14,510
Adjustments in respect of prior years (16 ) (5,299 ) (128 ) (5,230 )
26,159 35,893 105,536 52,421
Deferred:
Income tax expense (recovery) - origination, revaluation and/or reversal of temporary differences 5,632 (2,387 ) 209 (21,107 )
Mining tax (recovery) expense - origination, revaluation and/or reversal of temporary difference 555 982 (3,553 ) (1,087 )
Adjustments in respect of prior years (2,999 ) 4,171 (2,812 ) 4,606
3,188 2,766 (6,156 ) (17,588 )
$ 29,347 $ 38,659 $ 99,380 $ 34,833

Adjustments in respect of prior years refers to amounts changing due to the filing of tax returns and assessments from government authorities as well as any change identified that would result in a difference to our current or deferred tax balances as reported in the prior fiscal year end.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

21. Share capital

(a) Preference shares:

Authorized: Unlimited preference shares without par value.

Issued and fully paid: Nil.

(b) Common shares:

Authorized: Unlimited common shares without par value.

Issued and fully paid:

Nine months ended <br>Sep. 30, 2024 Year ended<br>Dec. 31, 2023
Common shares Amount Common shares Amount
Balance, beginning of year 350,728,536 $ 2,240,233 262,019,857 $ 1,780,774
Exercise of options 462,530 2,926 67,145 291
Exercise of warrants 105,705 751 - -
Shares issued on acquisition of Copper Mountain, net of share issuance costs - - 84,165,617 436,499
Shares issued on acquisition of Rockcliff - - 2,675,324 12,503
Flow through shares, net of share issuance costs - - 1,960,000 10,166
Cancelled shares - - (159,407 ) -
Shares issued on equity raise, net of share issuance costs 42,366,000 386,195 - -
Balance, end of period 393,662,771 $ 2,630,105 350,728,536 $ 2,240,233

During the nine months ended September 30, 2024, the Company declared two semi-annual dividends of C$0.01 per share. The Company paid $2,591 and $2,897 in dividends on March 22, 2024 and September 20, 2024 to shareholders of record as of March 5, 2024 and September 3, 2024.

On May 24, 2024, the Company closed an equity financing with a syndicate of underwriters ("the Offering"). Pursuant to the Offering, the Underwriters purchased on a bought deal basis from the Company a total of 42,366,000 common shares at a price of $9.50 per Common Shares for aggregate gross proceeds of $402,477. Transaction costs related to the Offering were $16,099 resulting in net proceeds to the Company of $386,378. Associated with the Offering were $183 of share issuance costs resulting in net equity raised of $386,195.

During the year ended December 31, 2023, the Company declared two semi-annual dividends of C$0.01 per share. The Company paid $1,908 and $2,555 in dividends on March 24, 2023 and September 22, 2023 to shareholders of record as of March 7, 2023 and September 1, 2023.

During the year ended December 31, 2023, the Company completed a Canadian Development Expense and Canadian Exploration Expense flow-through financing. The Company issued 1,960,000 common shares for proceeds, net of transaction costs, of $14,424. The implied premium on the flow-through shares of $4,258 was recorded as a flow-through share liability. The flow-through share liability will be recognized in earnings as eligible expenditures are made. For three and nine months ended September 30, 2024, $1,980 and $2,972, respectively, of flow-through share liability was renounced and recognized in other expenses (note 6c) on the condensed consolidated interim statements of income, respectively.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(c) Equity-settled share-based compensation - stock options:

The Company's stock option plan was approved in June 2005 and amended in May 2008 (the "Plan"). Under the amended Plan, the Company may grant to employees, officers, directors or consultants of the Company or its affiliates options to purchase up to a maximum of 13 million common shares of Hudbay. The Company has determined that the appropriate accounting treatment is to classify the stock options as equity settled transactions.

The following table outlines the changes in the number of stock options outstanding:

Sep. 30, 2024 Dec. 31, 2023
Number ofshares subjectto option Weighted-averageexercise priceC$ Number of<br>shares subject<br>to option Weighted<br>average<br>exercise price<br>C$
Balance, beginning of year 2,182,970 $ 7.23 1,528,760 $ 7.38
Number of units granted 902,874 $ 7.50 801,661 $ 6.75
Exercised (413,263 ) $ 6.27 (67,145 ) $ 3.79
Forfeited (105,481 ) $ 7.63 (80,306 ) $ 8.33
Expired (12,858 ) $ 10.03 - $ -
Balance, end of period 2,554,242 $ 7.45 2,182,970 $ 7.23

The following table outlines stock options outstanding and exercisable:

Sep. 30, 2024
Range ofexercise pricesC$ Number ofoptionsoutstanding Weighted averageremainingcontractual life(years) Weightedaverageexercise priceC$ Number ofoptionsexercisable Weightedaverage shareprice at exercisedate C$
$3.76 - $5.26 371,495 2.4 $ 3.76 371,495 $ 3.76
$5.27 - $6.90 651,986 5.4 $ 6.75 171,855 $ 6.75
$6.91 - $8.71 867,357 6.4 $ 7.50 - $ -
$8.72 - $10.17 383,628 4.4 $ 9.92 240,927 $ 9.92
$10.18 - $10.42 279,776 3.4 $ 10.42 279,776 $ 10.42
Dec. 31, 2023
--- --- --- --- --- --- --- ---
Range of<br>exercise prices<br>C$ Number of<br>options<br>outstanding Weighted average<br>remaining<br>contractual life<br>(years) Weighted<br>average<br>exercise price<br>C$ Number of<br>options<br>exercisable Weighted<br>average share<br>price at exercise<br>date C$
$3.76 - $4.82 568,801 3.2 $ 3.76 568,801 $ 3.76
$5.91 - $6.75 779,959 6.2 $ 6.75 - $ -
$6.76 - $10.17 488,340 5.2 $ 9.76 174,989 $ 9.57
$10.18 - $10.42 345,870 4.2 $ 10.42 230,514 $ 10.42

Hudbay estimates expected life of options and expected volatility based on historical data, which may differ from actual outcomes.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

22. Earnings per share

Three months ended September 30, Nine months ended September 30,
2024 2023 2024 2023
Weighted average common shares outstanding
Basic 393,604,853 346,720,425 370,992,994 293,970,111
Plus net incremental shares from:
Assumed conversion: stock options 515,275 266,737 412,921 270,587
Assumed conversion: warrants 116,533 - 98,989 -
Diluted weighted average common shares outstanding 394,236,661 346,987,162 371,504,904 294,240,698

The calculation of dilutive weighted-average number of common shares excludes the impact of 390 and 56,581 shares for the three and nine months ended September 30, 2024, respectively (three and nine months ended September 30, 2023 - 328,358 and 287,138, respectively). The share units were excluded as the exercise price related to the particular security exceeded the average market price of the Company's common shares for the period, or the inclusion of the share units had an anti-dilutive effect on net earnings.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

23. Financial instruments

(a) Fair value and carrying value of financial instruments:

The following presents the fair value ("FV") and carrying value ("CV") of Hudbay's financial instruments and non-financial derivatives:

Sep. 30, 2024 Dec. 31, 2023
FV CV FV CV
Financial assets at amortized cost
Cash and cash equivalents1 443,273 $ 443,273 $ 249,794 $ 249,794
Short-term investments1 40,000 40,000 - -
Collateral deposits1 629 629 1,359 1,359
Restricted cash1 404 404 1,964 1,964
Fair value through profit or loss
Trade and other receivables2,3 226,799 226,799 176,214 176,214
Non-hedge derivative assets 4 1,095 1,095 1,416 1,416
Investments 5 10,064 10,064 6,452 6,452
Total financial assets 722,264 $ 722,264 $ 437,199 $ 437,199
Financial liabilities at amortized cost
Trade and other payables1, 2 245,899 $ 245,899 $ 219,304 $ 219,304
Deferred Rosemont acquisition consideration 8 - - 9,713 9,713
Agreements with communities 6 61,700 60,383 53,459 54,979
Wheaton refund liability10 11,811 7,112 10,346 6,653
Senior unsecured notes 7 1,120,266 1,110,563 1,176,312 1,190,586
Senior secured revolving credit facilities11 (1,663 ) (1,663 ) 96,950 96,950
Fair value through profit or loss
Gold prepayment liability9 - - 55,901 55,901
Non-hedge derivative liabilities 4 21,481 21,481 11,811 11,811
Total financial liabilities 1,459,494 $ 1,443,775 $ 1,633,796 $ 1,645,897
1 Cash and cash equivalents, short-term investments, collateral deposits, restricted cash, trade and other payables are recorded at carrying value, which approximates fair value due to their short-term nature and generally negligible credit losses.
2 Excludes tax and other statutory amounts.
3 Trade and other receivables contain receivables including provisionally priced receivables classified as FVTPL and various other items at amortized cost. The fair value of provisionally priced receivables is determined using forward metals prices (level 2).
4 Derivatives are carried at their fair value, which is determined based on observable forward market commodity prices corresponding to the maturity of the contract (level 2),
5 All investments are carried at their fair value, which is determined using quoted market bid prices in active markets for listed shares.
6 These financial liabilities relate to agreements with communities near the Constancia project in Peru (note 14). Fair values have been determined using an applicable credit-risk adjusted discounted rate and foreign exchange rates (level 3).
7 Fair value of the senior unsecured notes (note 17a) has been determined using an applicable credit-risk adjusted discount rate (level 3).
8 Discounted value based on a risk adjusted discount rate.
9 The gold prepayment liability (note 15) is designated as fair value through profit or loss under the fair value option. Fair value is determined using observable gold forward prices corresponding to the delivery of gold ounces in the contract along with an estimate of credit-risk for similar instruments (level 3). Gains and losses related to the Company's own credit-risk have been recorded at fair value through other comprehensive income. The fair value adjustment recorded in other comprehensive income for the nine months ended September 30, 2024 was a loss of 4,339 (year ended December 31, 2023 was a loss of 192).
10 Discounted value based on a market rate at inception of the applicable Wheaton contract for carrying value (note 14) and fair value using an applicable credit-risk adjusted discount rate (level 3).
11 Fair value of the senior secured revolving credit facility is valued using an applicable credit adjusted discount rate (level 3).

All values are in US Dollars.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

Fair value hierarchy

The table below provides an analysis by valuation method of financial instruments that are measured at fair value subsequent to recognition as well as financial instruments not measured at fair value but for which a fair value is disclosed. Levels 1 to 3 are defined based on the degree to which fair value inputs are observable and have a significant effect on the recorded fair value, as follows:

  • Level 1: Quoted prices in active markets for identical assets or liabilities;

  • Level 2: Valuation techniques use significant observable inputs, either directly or indirectly, or

valuations are based on quoted prices for similar instruments; and,

  • Level 3: Valuation techniques use significant inputs that are not based on observable market

data.

September 30, 2024 Level 1 Level 2 Level 3 Total
Financial assets at FVTPL:
Non-hedge derivatives $ - $ 1,095 $ - $ 1,095
Investments 10,064 - - 10,064
$ 10,064 $ 1,095 $ - $ 11,159
Financial liabilities at FVTPL:
Non-hedge derivatives $ - $ 21,481 $ - $ 21,481
Financial liabilities at amortized cost:
Agreements with communities - - 60,383 60,383
Wheaton refund liability - - 11,811 11,811
Senior unsecured notes 1,120,266 - - 1,120,266
$ 1,120,266 $ 21,481 $ 72,194 $ 1,213,941
December 31, 2023 Level 1 Level 2 Level 3 Total
--- --- --- --- --- --- --- --- ---
Financial assets at FVTPL:
Non-hedge derivatives $ - $ 1,416 $ - $ 1,416
Investments 6,452 - - 6,452
$ 6,452 $ 1,416 $ - $ 7,868
Financial liabilities at FVTPL:
Non-hedge derivatives $ - $ 11,811 $ - $ 11,811
Gold prepayment liability - 55,901 - 55,901
Financial liabilities at amortized cost:
Agreements with communities - - 53,459 53,459
Wheaton refund liability - - 10,346 10,346
Senior secured revolving credit facilities - - 96,950 96,950
Senior unsecured notes 1,176,312 - - 1,176,312
$ 1,176,312 $ 67,712 $ 160,755 $ 1,404,779

The Company's policy is to recognize transfers into and transfers out of fair value hierarchy levels as of the date of the event or change in circumstances that caused the transfer. During the three and nine months ended September 30, 2024 and year ended December 31, 2023, Hudbay did not make any such transfers.

Valuation techniques used for instruments categorized in Levels 2 and 3 are consistent with the year ended December 31, 2023.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(b) Derivatives and hedging:

Copper fixed for floating swaps

Hudbay enters into copper fixed for floating swaps in order to manage the risk associated with provisional pricing terms in copper concentrate sales agreements. As at September 30, 2024, Hudbay had 48.6 million pounds of net copper swaps outstanding at an effective average price of $4.30/lb and settling from October 2024 to March 2025. As at December 31, 2023, Hudbay had 90.6 million pounds of net copper swaps outstanding at an effective average price of $3.74/lb and settling from January to May 2024. The aggregate fair value of the transactions at September 30, 2024 was a liability of $7,557 (December 31, 2023 - a liability position of $9,515).

Zinc fixed for floating swaps

Hudbay enters into zinc fixed for floating swaps in order to manage the risk associated with provisional pricing terms in zinc concentrate sales agreements. As at September 30, 2024, Hudbay had 8.8 million pounds of net zinc swaps outstanding at an effective average price of $1.30/lb and settling from October 2024 to January 2025. As at December 31, 2023, Hudbay had 13.9 million pounds of net zinc swaps outstanding at an effective average price of $1.14/lb and settling from January to March 2024. The aggregate fair value of the transactions at September 30, 2024 was a liability of $805 (December 31, 2023 - a liability position of $945).

Copper forward sales

As at September 30, 2024, Hudbay had 9.3 million pounds of copper forwards outstanding at an effective average price of $3.95/lb and settling from October 2024 to April 2025. As at December 31, 2023, Hudbay had 7.9 million pounds of copper forwards outstanding at an effective average price of $3.93/lb and settling from May 2024 to April 2025. The aggregate fair value of the transactions at September 30, 2024 was a liability of $4,790 (December 31, 2023 - an asset position of $65).

Copper costless collars

As at September 30, 2024, Hudbay had 11.6 million pounds of copper collars outstanding settling from October 2024 to April 2025 at an average floor price of $3.88/lb and an average cap price of $4.14/lb. As at December 31, 2023, Hudbay had 13.2 million pounds of copper collars outstanding settling from May 2024 to April 2025 at an average floor price of $3.83/lb and an average cap price of $4.03/lb. The aggregate fair value of the position at September 30, 2024 was a liability of $4,298 (December 31, 2023 - nil).

Gold costless collars

During the first nine months of 2024, Hudbay entered into zero-cost collar program. As at September 30, 2024, 15,000 ounces of gold collars were unsettled (December 31, 2023 - nil) at an average floor price of $2,110/oz and average cap price of $2,467/oz and settling from October 2024 to December 2024. The aggregate fair value of the position at September 30, 2024 was a liability of $2,936 (December 31, 2023 - nil).

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

(c) Provisionally priced receivables

Changes in fair value of provisionally priced receivables

Hudbay records changes in fair value of provisionally priced receivables related to provisional pricing in concentrate purchase, concentrate sale and certain other sale contracts. Under the terms of these contracts, prices are subject to final adjustment at the end of a future period after title transfers based on quoted market prices during the quotation period specified in the contract. The period between provisional pricing and final pricing is typically up to three months.

Changes in fair value of provisionally priced receivables are presented in trade and other receivables when they relate to sales contracts and in trade and other payables when they relate to purchase contracts. At each reporting date, provisionally priced metals are marked-to-market based on the forward market price for the quotation period stipulated in the contract, with changes in fair value recognized in revenue for sales contracts and in inventory or cost of sales for purchase concentrate contracts. Cash flows related to changes in fair value of provisionally priced receivables are classified in operating activities.

As at September 30, 2024 and December 31, 2023, Hudbay's net position consisted of contracts awaiting final pricing are as indicated below:

Metal in concentrate Sales awaiting final pricing Average YTD price (/unit)
Unit Sep. 30, 2024 Dec. 31, 2023 Sep. 30, 2024
Copper pounds (in 000s) 68,874 111,069 4.44
Gold troy ounces 41,759 50,563 2,643
Silver troy ounces 193,987 205,579 31.23
Zinc pounds (in 000s) 10,284 16,416 1.39

All values are in US Dollars.

The aggregate fair value of provisionally priced receivables within the copper and zinc concentrate at September 30, 2024, was an asset position of $16,928 (December 31, 2023 - an asset position of $22,635).

(d) Other financial liabilities

Gold prepayment liability

The gold prepayment liability (note 15) requires settlement by physical delivery of gold ounces or equivalent gold credits. As at September 30, 2024, the liability was settled. The fair value of the financial liability at September 30, 2024 was nil (December 31, 2023 - a liability of $55,901).

24. Commitments

Capital commitments

As at September 30, 2024, Hudbay had outstanding capital commitments in Manitoba of approximately $5,927 of which $3,162 can be terminated, approximately $5,418 in British Columbia of which $525 can be terminated, approximately $57,288 in Peru, all of which can be terminated, and approximately $35,195 in Arizona, primarily related to the Copper World Complex, of which none can be terminated.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

25. Supplementary cash flow information

(a) Other operating activities:

Three months ended<br>September 30, Nine months ended<br>September 30,
2024 2023 2024 2023
Share-based compensation paid $ (342 ) $ - $ (4,484 ) $ (5,817 )
Share-based compensation and change of control payments made upon acquisition of Copper Mountain - - (6,743 )
Other 117 (187 ) 605 (164 )
$ (225 ) $ (187 ) $ (3,879 ) $ (12,724 )

(b) Change in non-cash working capital:

Three months ended<br>September 30, Nine months ended<br>September 30,
2024 2023 2024 2023
Change in:
Trade and other receivables $ (62,249 ) $ (35,350 ) $ (45,540 ) $ 2,692
Other financial assets/liabilities 7,160 8,276 (4,769 ) (23,504 )
Inventories (4,894 ) (3,214 ) 10,420 (7,636 )
Prepaid expenses 1,928 4,963 (4,620 ) 12,735
Trade and other payables 18,643 (4,851 ) 14,384 (44,872 )
Provisions and other liabilities (732 ) 144 (1,428 ) (15,097 )
$ (40,144 ) $ (30,032 ) $ (31,553 ) $ (75,682 )

(c) Non-cash transactions:

During the nine months ended September 30, 2024 and 2023, Hudbay entered into the following non-cash investing and financing activities which are not reflected in the condensed consolidated interim statements of cash flows:

  • Remeasurement of Hudbay's decommissioning and restoration liabilities led to a net decrease in related property, plant and equipment assets of $1,179 (September 30, 2023 - a net increase of $12,332), mainly related to changes to real discount rates associated with remeasurement of the liabilities.

  • Property, plant and equipment included $10,254 (September 30, 2023 - $20,772) of capital additions related to the recognition of ROU assets and $43,869 (September 30, 2023 - nil) of capital additions related to the recognition of property, plant and equipment that has been financed. Property, plant and equipment and other assets include $8,091 of capital additions related to agreements with communities (September 30, 2023 - $3,392). Property, plant and equipment as of September 30, 2023 included $14,198 of capital additions related to exploration and evaluation assets acquired through the acquisition of Rockcliff.

HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023

26. Segmented information

Hudbay has the following reportable segments identified by the individual mining operations of Manitoba, British Columbia, Peru, as well as Arizona which holds our Copper World project. Corporate and other activities are not considered an operating segment and are included as a reconciliation to total consolidated results. Corporate and other activities include the Company's exploration activities in Chile, Canada and the State of Nevada. These exploration entities are not individually significant, as they do not meet the minimum quantitative thresholds for standalone segment disclosure.

Three months ended September 30, 2024
Peru Manitoba BritishColumbia Arizona Corporateand otheractivities Total
Revenue from external customers $ 209,953 $ 203,956 $ 71,864 $ - $ - $ 485,773
Cost of sales
Mine operating costs 123,696 82,345 42,494 - - 248,535
Depreciation and amortization 57,242 27,662 12,548 - - 97,452
Gross profit 29,015 93,949 16,822 - - 139,786
Selling and administrative expenses - - - - 12,040 12,040
Exploration expenses 4,189 8,047 - - 6 12,242
Other expenses (income) 2,139 4,000 2,262 106 (649 ) 7,858
Re-evaluation adjustment - environmental provision - 1,969 - - - 1,969
Results from operating activities $ 22,687 $ 79,933 $ 14,560 $ (106 ) $ (11,397 ) $ 105,677
Net interest expense on long term debt 16,217
Accretion on streaming arrangements 6,000
Change in fair value of financial instruments 3,741
Other net finance costs 18
Earnings before tax 79,701
Tax expense 29,347
Net earnings for the period $ 50,354
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---
Three months ended September 30, 2023
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Peru Manitoba British<br>Columbia Arizona Corporate<br>and other<br>activities Total
Revenue from external customers $ 293,354 $ 105,321 $ 81,781 $ - $ - $ 480,456
Cost of sales
Mine operating costs 124,020 73,948 62,336 - - 260,304
Depreciation and amortization 80,625 26,873 6,255 - - 113,753
Gross profit 88,709 4,500 13,190 - - 106,399
Selling and administrative expenses - - - - 10,128 10,128
Exploration expenses 2,866 947 - - 933 4,746
Other expenses 1,668 4,429 2,332 73 383 8,885
Re-evaluation adjustment - environmental provision - (31,851 ) (585 ) - - (32,436 )
Results from operating activities $ 84,175 $ 30,975 $ 11,443 $ (73 ) $ (11,444 ) $ 115,076
Net interest expense on long term debt 21,078
Accretion on streaming arrangements 6,597
Change in fair value of financial instruments (950 )
Other net finance costs 4,202
Earnings before tax 84,149
Tax expense 38,659
Net earnings for the period $ 45,490
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---
Nine months ended September 30, 2024
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Peru Manitoba BritishColumbia Arizona Corporateand otheractivities Total
Revenue from external customers $ 702,687 $ 515,740 $ 217,855 $ - $ - $ 1,436,282
Cost of sales
Mine operating costs 369,335 231,998 161,211 - - 762,544
Depreciation and amortization 187,132 79,000 38,239 - - 304,371
Gross profit 146,220 204,742 18,405 - - 369,367
Selling and administrative expenses - - - - 47,064 47,064
Exploration expenses 10,502 18,714 5 - 1,564 30,785
Other expenses (income) 10,388 10,853 5,829 8,316 (55 ) 35,331
Re-evaluation adjustment - environmental provision - (5,985 ) - - - (5,985 )
Results from operating activities $ 125,330 $ 181,160 $ 12,571 $ (8,316 ) $ (48,573 ) $ 262,172
Net interest expense on long term debt 53,885
Accretion on streaming arrangements 18,176
Change in fair value of financial instruments 23,913
Other net finance costs 18,306
Earnings before tax 147,892
Tax expense 99,380
Net earnings for the period $ 48,512
HUDBAY MINERALS INC.<br>Notes to Unaudited Condensed Consolidated Interim Financial Statements<br>(in thousands of US dollars, except where otherwise noted)<br>For the three and nine months ended September 30, 2024 and 2023
---
Nine months ended September 30, 2023
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Peru Manitoba British<br>Columbia Arizona Corporate<br>and other<br>activities Total
Revenue from external customers $ 698,290 $ 307,770 $ 81,781 $ - $ - $ 1,087,841
Cost of sales
Mine operating costs 358,613 201,242 62,336 - - 622,191
Depreciation and amortization 189,925 73,665 6,255 - - $ 269,845
Gross profit 149,752 32,863 13,190 - - 195,805
Selling and administrative expenses - - - - 27,874 27,874
Exploration expenses 9,737 7,471 - - 1,099 18,307
Other expenses 4,400 12,932 2,332 396 7,678 27,738
Re-evaluation adjustment - environmental provision - (44,783 ) (585 ) - - (45,368 )
Results from operating activities $ 135,615 $ 57,243 $ 11,443 $ (396 ) $ (36,651 ) $ 167,254
Net interest expense on long term debt 55,885
Accretion on streaming arrangements 19,694
Change in fair value of financial instruments 4,560
Other net finance costs 16,267
Earnings before tax 70,848
Tax expense 34,833
Net earnings for the period $ 36,015
September 30, 2024
--- --- --- --- --- --- --- --- --- --- --- ---
Peru Manitoba BritishColumbia Arizona Corporateand otheractivities Total
Total assets 2,346,724 $ 648,834 $ 1,119,510 $ 742,344 $ 650,663 $ 5,508,075
Total liabilities 930,902 430,474 315,981 11,659 1,180,167 2,869,183
Property, plant and equipment1 1,930,877 646,740 920,933 733,666 41,337 4,273,553
1 Included in Corporate and other activities are 27.6 million of property, plant and equipment that is located in Nevada.

All values are in US Dollars.

December 31, 2023
Peru Manitoba^2^ British<br>Columbia^2^ Arizona Corporate<br>and other<br>activities^2^ Total
Total assets 2,406,260 $ 673,437 $ 1,018,602 $ 736,680 $ 477,655 $ 5,312,634
Total liabilities 1,086,229 413,355 274,510 23,446 1,308,255 3,105,795
Property, plant and equipment1 2,001,716 693,972 850,477 727,903 41,938 4,316,006
1 Included in Corporate and other activities are 27.6 million of property, plant and equipment that is located in Nevada.
2 On January 1, 2024, the Company amalgamated with Copper Mountain Mining Inc., Hudbay British Columbia Inc. and Rockcliff Metals Corp. and continued carrying on business as Hudbay Minerals Inc. Following the amalgamation Copper Mountain Mining Inc. and Hudbay British Columbia Inc, which do not contain operating assets and have liabilities primarily related to head office finance leases, have moved from British Columbia to Corporate and other activities. Rockcliff Metals Corp. has move from Corporate and other activities to the Manitoba segment

All values are in US Dollars.

Hudbay Minerals Inc.: Exhibit 99.2 - Filed by newsfilecorp.com

Management's Discussion and Analysis of

Results of Operations and Financial Condition

For the three and nine months ended

September 30, 2024

November 12, 2024

TABLE OF CONTENTS Page
Introduction 1
Our Business 1
Our Purpose 2
Summary 3
Key Financial Results 8
Key Production Results 9
Key Costs Results 10
Recent Developments 11
Peru Operations Review 15
Manitoba Operations Review 20
British Columbia Operations Review 25
Financial Review 29
Liquidity and Capital Resources 39
Trend Analysis and Quarterly Review 45
Non-IFRS Financial Performance Measures 47
Accounting Changes and Critical Estimates 63
Changes in Internal Control over Financial Reporting 63
Notes to Reader 63
Summary of Historical Results 66

INTRODUCTION

This Management's Discussion and Analysis ("MD&A") dated November 12, 2024 is intended to supplement Hudbay Minerals Inc.'s unaudited condensed consolidated interim financial statements and related notes for the three and nine months ended September 30, 2024 and 2023 (the "consolidated interim financial statements"). The consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS"), including International Accounting Standard 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB").

References to "Hudbay", the "Company", "we", "us", "our" or similar terms refer to Hudbay Minerals Inc. and its direct and indirect subsidiaries as at September 30, 2024.

Readers should be aware that:

^-^ This MD&A contains certain "forward-looking statements" and "forward-looking information" (collectively, "forward-looking information") that are subject to risk factors set out in a cautionary note contained in our MD&A.

^-^ This MD&A includes information with respect to Hudbay's acquisition of Copper Mountain, which was completed on June 20, 2023, including the results of the Copper Mountain mine's operations from the date of acquisition, June 20, 2023.

  • This MD&A has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to US issuers.

  • We use a number of non-IFRS financial performance measures in our MD&A, which do not have standardized meaning under IFRS. For further information and detailed reconciliations of such measures, please see the discussion under the "Non-IFRS Financial Performance Measures" section herein.

  • The technical and scientific information in this MD&A has been approved by qualified persons based on a variety of assumptions and estimates. Please see the discussion under the "Qualified Person and NI 43-101" section herein.

Readers are also urged to review the "Notes to Reader" section beginning on page 63 of this MD&A.

Additional information regarding Hudbay, including the risks related to our business and those that are reasonably likely to affect our consolidated interim financial statements in the future, is contained in our continuous disclosure materials, including our most recent AIF, consolidated interim financial statements and Management Information Circular available on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov.

All amounts are in US dollars unless otherwise noted.

OUR BUSINESS

We are a diversified mining company with long-life assets in North and South America. Our Constancia operations in Cusco (Peru) produce copper with gold, silver and molybdenum by-products. Our Snow Lake operations in Manitoba (Canada) produce gold with copper, zinc and silver by-products. Our Copper Mountain operations in British Columbia (Canada) produce copper with gold and silver by-products. We have a copper-focused project development pipeline that includes the Copper World project in Arizona (United States) and the Mason project in Nevada (United States), and our growth strategy is focused on the exploration, development, operation, and optimization of properties we already control, as well as other mineral assets we may acquire that fit our strategic criteria. We are governed by the Canada Business Corporations Act and our shares are listed under the symbol "HBM" on the Toronto Stock Exchange, New York Stock Exchange and Bolsa de Valores de Lima.

OUR PURPOSE

We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities.

We transform lives: We invest in our employees, their families and local communities through long-term employment, local procurement and economic development to improve their quality of life and ensure the communities benefit from our presence.

We operate responsibly: From exploration to closure, we operate safely and responsibly, we welcome innovation and we strive to minimize our environmental footprint while following leading operating practices in all facets of mining.

We provide critical metals: We produce copper and other metals needed for everyday products and essential for applications to support the energy transition toward a more sustainable future.

SUMMARY

Delivered Strong Third Quarter Operating and Financial Results, Led by Record Gold Production from Manitoba Operations; 2024 Production Guidance Reaffirmed and Cost Guidance Further Improved

  • Achieved consolidated copper production of 31,354 tonnes, in line with quarterly production cadence, and gold production of 89,073 ounces, far exceeding expectations, in the third quarter of 2024, representing an increase of 10% and 52%, respectively, from the second quarter of 2024.

  • Enhanced operating platform delivered strong quarterly performance with record gold production at our Manitoba operations, the completion of planned stripping activities at Pampacancha in Peru and the benefits from stabilization and optimization initiatives at the Copper Mountain mine in British Columbia.

  • Reaffirmed full year 2024 consolidated production guidance for all metals. Full-year consolidated copper production expected to trend towards the lower end of the guidance range and consolidated gold production expected to trend towards the higher end of the guidance range.

  • Strong operating cost performance with consolidated cash cost^1^ and sustaining cash cost^1^ per pound of copper produced, net of by-product credits^1^, in the third quarter of 2024 of $0.18 and $1.71, respectively, an improvement of 84% and 35%, respectively, from the second quarter of 2024.

  • Further improved 2024 annual operating cost guidance with decreased consolidated cash cost^1^ guidance range of $0.65 to $0.85 per pound, an additional improvement from the previously updated guidance range of $0.90 to $1.10 per pound, and decreased consolidated sustaining cash cost guidance range of $1.75 to $2.20 per pound from original guidance of $2.00 to $2.45 per pound, as a result of increased exposure to gold by-product credits and continued strong cost control across all operations.

  • Peru operations continued to benefit from strong mill throughput, achieving a quarterly average of approximately 88,000 tonnes per day in the third quarter. The Pampacancha stripping program to advance to higher grades was completed in late September and is on track to achieve higher copper and gold grade ore in the fourth quarter. Peru operations produced 21,220 tonnes of copper and 20,331 ounces of gold in the third quarter of 2024, in line with quarterly cadence expectations. Peru cash cost per pound of copper produced, net of by-product credits^1^, $1.80 in the third quarter and is expected to improve in the fourth quarter of 2024 with continued strong cost control and higher copper and gold production.

  • Manitoba operations produced 62,468 ounces of gold in the third quarter of 2024, far exceeding management's quarterly cadence expectations and achieving record quarterly production levels as New Britannia continues to operate well above nameplate and budgeted throughput levels and the Lalor mine continues to achieve better-than-expected gold grades. Manitoba cash cost per ounce of gold produced, net of by-product credits^1^, was $372 during the third quarter of 2024, a decrease of 52% compared to the second quarter of 2024. Full year Manitoba gold production is expected to exceed the top end of the 2024 guidance range.

  • British Columbia operations produced 6,736 tonnes of copper at a cash cost per pound of copper produced, net of by-product credits^1^, of $1.81 in the third quarter of 2024. Achieved record quarterly copper recoveries of 84% and strong unit cost performance as a result of the successful operational stabilization efforts as mine stripping activities accelerate and mill optimization initiatives are underway. Full-year British Columbia copper production is expected to be slightly below the lower end of the 2024 guidance range.

  • Achieved revenue of $485.8 million and operating cash flow before change in non-cash working capital of $186.3 million in the third quarter of 2024. Strong financial results were driven by higher realized gold prices as well as robust gold production in Manitoba, while delivering on higher recovery, throughput and cost control initiatives across all business units.

- Third quarter net earnings attributable to owners and earnings per share attributable to owners were $49.8 million and $0.13, respectively. After adjusting for items on a pre-tax basis such as a non-cash gain of $2.0 million related to a quarterly revaluation of our closed site environmental reclamation provision, a $5.2 million mark-to-market revaluation loss on various instruments such as the gold prepayment liability, unrealized strategic gold and copper hedges, investments and share-based compensation and a $2.2 million write-down of PP&E, among other items, third quarter adjusted earnings^1^ per share attributable to owners was $0.13.

  • Adjusted EBITDA^1^ was $206.2 million during the third quarter of 2024, a 42% increase compared to the second quarter of 2024.

  • Cash and cash equivalents and short-term investments increased by $233.5 million to $483.3 million during the first nine months of 2024 due to a successful equity offering and strong operating cash flows bolstered by higher copper and gold prices, which enabled a $412.1 million reduction in net debt^1^ during the first nine months of 2024.

Accelerated Deleveraging and Improved Balance Sheet Flexibility

  • Hudbay's unique copper and gold diversification in Peru and North America provides exposure to higher copper and gold prices and attractive free cash flow generation.

  • While a majority of revenues continue to be from copper, gold is representing an increasing portion of total revenues at 36% in the third quarter of 2024 and 33% year-to-date, compared to 27% and 26%, respectively, for the same periods in 2023, driven by higher gold production and strong leverage to higher gold prices.

  • During the third quarter of 2024, deleveraging efforts continued with additional open market purchases of approximately $48.5 million of our senior unsecured notes in July and August 2024 at a discount. Long-term debt reduced to $1,108.9 million at September 30, 2024 from $1,287.5 million at December 31, 2023.

  • On August 30, 2024, Hudbay completed the final monthly payment to settle the gold prepayment liability that was used to fund the refurbishment of the New Britannia gold mill. The elimination of the gold prepayment liability will further increase the Company's exposure to higher gold production in Snow Lake.

  • Impressive operating cash flow before change in non-cash working capital generation of $186.3 million despite lower realized copper prices compared to the second quarter of 2024, capitalizing on higher gold production from Manitoba following the full repayment of our gold prepayment liability in August.

  • Achieved trailing 12 month adjusted EBITDA^1^of $839.8 million, a substantial increase from $498.5 million for the 12 months ending September 30, 2023.

  • Reduced net debt^1^ to $625.6 million in the third quarter of 2024. The third quarter represents the fifth consecutive quarter of lower net debt as a result of deleveraging efforts and capitalizing on strong operating cash flow generation.

  • The increase in cash and reduction in long-term debt significantly reduced our net debt to adjusted EBITDA ratio^1^ to 0.7x at September 30, 2024 compared to 1.6x at the end of 2023, well within the targeted 1.2x net debt to adjusted EBITDA ratio outlined in our three prerequisites plan (the "3-P plan") for advancing Copper World, including receipts of permits, a robust definitive feasibility study plan and a prudent financing strategy.

  • Total liquidity substantially increased by 58% to $907.7 million at September 30, 2024 from $573.7 million at the end of 2023.

  • Subsequent to the quarter end, further improved long-term balance sheet resilience with a proactive three-year extension of our senior secured revolving credit facilities from October 2025 to November 2028. The extended credit facilities provide increased financial flexibility to accretively maintain our 4.50% coupon 2026 senior unsecured notes outstanding to maturity and advance Copper World towards a sanctioning decision in accordance with the 3-P plan. The $450 million revolving credit facility includes an improved pricing grid reflecting the enhanced financial position of Hudbay and features an opportunity to increase the facility by an additional $150 million at our discretion during the four-year tenor, providing additional financial flexibility.

Advancing Growth Initiatives to Further Enhance Copper and Gold Exposure

  • The successful completion of the planned stripping program at Pampacancha in September is expected to lead to significantly higher copper and gold grades in the fourth quarter of 2024, which together with maintaining strong operating performance at Constancia is expected to continue to generate meaningful free cash flow in Peru.

  • The New Britannia mill continued to exceed expectations, driving continued strong gold production and free cash flow generation in Manitoba. The New Britannia mill achieved record throughput levels of approximately 2,080 tonnes per day in the third quarter, exceeding its original design capacity of 1,500 tonnes per day and its 2024 budgeted capacity of 1,800 tonnes per day due to the successful implementation of process improvement initiatives and effective preventative maintenance measures.

  • We have successfully implemented post-acquisition plans to stabilize the Copper Mountain operations through mining fleet ramp-up activities and increased mill reliability and performance. Achieved record mill availability of 95% and record copper recoveries of 84% in the third quarter of 2024. Efforts are now focused on optimizing the operations through execution of the planned accelerated stripping program and mill throughput improvement projects.

  • Received the Aquifer Protection Permit for Copper World in August, a key milestone and de-risking event in the advancement of the project. Continued to progress the 3-P plan for sanctioning Copper World, with transformed balance sheet near targeted levels and the remaining key state permit progressing on track. As disclosed in August, we commenced activities related to the preparation of feasibility studies for Copper World, resulting in an expected increase of $25 million in growth capital spending in Arizona.

  • Drill permitting for highly prospective Maria Reyna and Caballito properties near Constancia continues to advance through the multi-step regulatory process with the environmental impact assessment applications approved for Maria Reyna in June and Caballito in September.

  • The development of an access drift to the 1901 deposit in Snow Lake remains on track to reach mineralization in early 2025 and is intended to enable confirmation of the optimal mining method for the deposit and underground drilling to further evaluate the orebody and upgrade inferred gold resources to reserves. Initiated the development of an adjacent haulage drift to de-risk planned full production in 2027.

  • Large 2024 exploration program continues in Snow Lake with eight drill rigs testing targets near Lalor and regional satellite properties. Includes follow-up drilling at Lalor Northwest located 400 metres from Lalor's underground infrastructure and the testing of a deep geophysical target at the Cook Lake North property.

  • Continuing to advance Flin Flon tailings reprocessing opportunities through metallurgical test work and early economic evaluation to assess the possibility of producing critical minerals and precious metals while reducing the environmental footprint.

Summary of Third Quarter Results

Cash generated from operating activities of $146.2 million increased in the third quarter of 2024 compared to the second quarter of 2024, and was lower by $5.8 million compared to the same period in 2023. The decrease compared to the same period in 2023 is reflective of the timing of sales which occurred late in the current quarter, where payment was subsequently made by customers in October. Operating cash flow before change in non-cash working capital was $186.3 million during the third quarter of 2024, reflecting an increase of $4.3 million compared to the third quarter of 2023. The increase was primarily the result of higher gold production and sales volumes in Manitoba, strong operational cost performance across the business and higher realized metal prices. This was partially offset by lower copper sales volumes in Peru due to mining of the high-grade zones of the Pampacancha deposit in the third quarter of 2023 as well as a significant increase in cash taxes paid of $17.3 million at our Peru operations, compared to the same period in 2023.

Consolidated copper, gold, silver and zinc production in the third quarter of 2024 decreased by 25%, 12%, 7% and 22%, respectively, compared to the same period in 2023 primarily due to lower production and lower recoveries in Peru partially offset by higher gold production in Manitoba and British Columbia. With the completion of the planned stripping program in Peru at the end of the third quarter, October production results have already delivered higher grades as mining of the higher grade zones at Pampacancha is underway, in line with the mine plan.

Net earnings attributable to owners in the third quarter of 2024 was $49.8 million, or $0.13 per share, compared to $45.5 million, or $0.13 per share, in the third quarter of 2023. The third quarter of 2024 was impacted by various non-cash charges for unrealized losses on strategic copper and gold hedges and revaluation of share-based compensation due to a higher share price.

Adjusted net earnings attributable to owners^1^and adjusted net earnings per share attributable to owners^1^ in the third quarter of 2024 were $50.3 million and $0.13 per share, respectively, after adjusting for items on a pre-tax basis such as a non-cash gain of $2.0 million related to a quarterly revaluation of our closed site environmental reclamation provision, a $5.2 million mark-to-market revaluation loss on various instruments such as the gold prepayment liability, unrealized strategic gold and copper hedges, investments and stock based compensation and a $2.2 million write-down of PP&E, among other items. This compares to adjusted net earnings attributable to owners^1^ and net earnings per share attributable to owners^1^ of $24.2 million and $0.07 per share in the same period of 2023.

Third quarter adjusted EBITDA^1^was $206.2 million, an 8.1% increase compared to $190.7 million in the same period in 2023. The increase is the result of higher realized metal prices and successful operating cost control across the business despite lower sales volumes.

In the third quarter of 2024, consolidated cash cost per pound of copper produced, net of by-product credits^1^, was $0.18, compared to $1.10 in the same period in 2023. This decrease was mainly the result of significantly higher by-product credits and strong cost control leading to lower mining, milling, treatment and refining costs, partially offset by higher G&A costs from incorporating Copper Mountain and lower copper production. Consolidated sustaining cash cost per pound of copper produced, net of by-product credits^1^, was $1.71 in the third quarter of 2024 compared to $1.89 in the same period in 2023. This decrease was primarily due to the same reasons outlined above partially offset by higher cash sustaining capital expenditures.

Consolidated all-in sustaining cash cost per pound of copper produced, net of by-product credits^1^, was $1.95 in the third quarter of 2024, lower than $2.04 in the same period in 2023 due to significant gold by-product credits and continued strong cost control across all operations.

As at September 30, 2024, total liquidity was $907.7 million, including $443.3 million in cash and cash equivalents, $40.0 million in short-term investments as well as undrawn availability of $424.4 million under our revolving credit facilities. Net debt^1^ declined to $625.6 million at the end of the third quarter of 2024 compared to $1,037.7 million at the end of 2023. We expect that our current liquidity together with cash flows from operations will be sufficient to meet our liquidity needs for the next year.

*Copper equivalent production is calculated using the quarter average LME prices for each metal.

^1^Adjusted net earnings (loss) - attributable to owners and adjusted net earnings (loss) per share - attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, combined unit cost, net debt and net debt to adjusted EBITDA ratio are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

KEY FINANCIAL RESULTS

Financial Condition
(in thousands, except net debt to adjusted EBITDA ratio) Sep. 30, 2024 Dec. 31, 2023
Cash and cash equivalents and short-term investments 483,273 $ 249,794
Total long-term debt 1,108,900 1,287,536
Net debt1 625,627 1,037,742
Working capital2 434,346 135,913
Total assets 5,508,075 5,312,634
Equity attributable to owners of the Company 2,537,845 2,096,811
Net debt to adjusted EBITDA 1 0.7 1.6

All values are in US Dollars.

^1^Net debt and net debt to adjusted trailing 12 month EBITDA are a non-IFRS financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

^2^Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated interim financial statements.

Financial Performance Three months ended Nine months ended
(in thousands, except per share amounts or as noted below) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Revenue 485,773 $ 480,456 $ 1,436,282 $ 1,087,841
Cost of sales 345,987 374,057 1,066,915 892,036
Earnings before tax 79,701 84,149 147,892 70,848
Net earnings for the period 50,354 45,490 48,512 36,015
Net earnings attributable to owners 49,762 45,125 55,537 35,650
Basic and diluted earnings per share - attributable 0.13 0.13 0.15 0.12
Adjusted earnings per share - attributable1 0.13 0.07 0.30 0.02
Operating cash flow before change in non-cash working capital2 186.3 182.0 455.9 323.5
Adjusted EBITDA1,2 206.2 190.7 565.2 373.4

All values are in US Dollars.

^1^ Adjusted earnings (loss) per share - attributable to owners and adjusted EBITDA are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

^2^ In $ millions.

KEY PRODUCTION RESULTS

Three months ended Three months ended
Sep. 30, 2024 Sep. 30, 2023
Peru Manitoba BritishColumbia^3^ Total Peru Manitoba British<br>Columbia^3^ Total
Contained metal in concentrate and doré produced^1^
Copper tonnes 21,220 3,398 6,736 31,354 29,081 3,580 9,303 41,964
Gold oz 20,331 62,468 6,274 89,073 40,596 56,213 4,608 101,417
Silver oz 648,209 281,397 55,963 985,569 697,211 264,752 101,069 1,063,032
Zinc tonnes - 8,069 - 8,069 - 10,291 - 10,291
Molybdenum tonnes 362 - - 362 466 - - 466
Payable metal sold
Copper tonnes 18,803 2,931 6,026 27,760 27,490 2,925 8,956 39,371
Gold^2^ oz 9,795 57,238 6,199 73,232 32,757 36,713 5,329 74,799
Silver^2^ oz 365,198 244,974 53,241 663,413 460,001 197,952 91,002 748,955
Zinc tonnes - 8,607 - 8,607 - 7,125 - 7,125
Molybdenum tonnes 343 - - 343 426 - - 426
Nine months ended Nine months ended
--- --- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023
Peru Manitoba BritishColumbia^3^ Total Peru Manitoba British<br>Columbia ^3^ Total
Contained metal in concentrate and doré produced^1^
Copper tonnes 65,013 9,189 20,479 94,681 67,280 8,419 10,542 86,241
Gold oz 60,147 162,787 15,145 238,079 64,800 127,500 5,353 197,653
Silver oz 1,738,760 711,867 221,566 2,672,193 1,669,021 596,144 112,987 2,378,152
Zinc tonnes - 24,954 - 24,954 - 28,895 - 28,895
Molybdenum tonnes 1,128 - - 1,128 1,169 - - 1,169
Payable metal sold
Copper tonnes 59,363 8,281 19,523 87,167 65,013 7,021 8,956 80,990
Gold^2^ oz 65,905 162,004 14,699 242,608 59,062 107,662 5,329 172,053
Silver^2^ oz 1,519,207 674,301 205,789 2,399,297 1,523,740 481,547 91,002 2,096,289
Zinc tonnes - 19,859 - 19,859 - 21,394 - 21,394
Molybdenum tonnes 1,105 - - 1,105 994 - - 994

^1^Metal reported in concentrate is prior to deductions associated with smelter contract terms.

^2^ Includes total payable gold and silver in concentrate and in doré sold.

^3^ Includes 100% of Copper Mountain mine production. Hudbay owns 75% of Copper Mountain mine. As Copper Mountain was acquired on June 20, 2023, the production for the nine months ended September 30, 2023 represents the period from acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

KEY COST RESULTS

Three months ended Nine months ended Guidance
Sep. 30,2024 Sep. 30,<br>2023 Sep. 30,2024 Sep. 30,<br>2023 Annual<br>2024^2^
Peru cash cost per pound of copper produced
Cash cost^1^ $/lb 1.80 0.83 1.28 1.34 1.25 - 1.60
Sustaining cash cost^1^ $/lb 2.78 1.51 2.08 2.10
Manitoba cash cost per ounce of gold produced
Cash cost^1^ $/oz 372 670 606 864 700 - 900
Sustaining cash cost^1^ $/oz 553 939 855 1,212
British Columbia cash cost per pound of copper produced^3^
Cash cost^1^ $/lb 1.81 2.67 2.67 2.36 2.00 - 2.50
Sustaining cash cost^1^ $/lb 5.06 3.39 5.15 2.99
Consolidated cash cost per pound of copper produced
Cash cost^1^ $/lb 0.18 1.10 0.46 1.14 0.65 - 0.85
Sustaining cash cost^1^ $/lb 1.71 1.89 1.74 2.04 1.75 - 2.20
All-in sustaining cash cost^1^ $/lb 1.95 2.04 2.06 2.24

^1^Cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, gold cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, and unit operating cost are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

^2^We have improved our 2024 annual consolidated cash cost guidance range to $0.65 to $0.85 per pound from the original guidance range of $1.05 to $1.25 per pound. We have also improved our 2024 annual consolidated sustaining cash cost guidance range to $1.75 to $2.20 per pound from the original guidance range of $2.00 to $2.45 per pound.

^3^As Copper Mountain was acquired on June 20, 2023, the results for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

RECENT DEVELOPMENTS

2024 Production Guidance Reaffirmed and Cash Cost Guidance Further Improved

We reaffirm our full year 2024 consolidated production guidance for all metals as we continue to deliver strong operating performance and we expect the fourth quarter to be the highest copper production quarter in 2024, in line with our quarterly cadence expectations. We expect 2024 consolidated copper production to trend towards the lower end of the guidance range and 2024 consolidated gold production to trend towards the higher end of the guidance range.

In Peru, the fourth quarter is expected to be the strongest quarter this year, and full year copper production is expected to trend towards the lower end of the guidance range, while gold production is expected to trend towards the higher end of the guidance range. In British Columbia, we expect to continue improving operating efficiencies in the fourth quarter, and full year copper production is expected to be slightly below the lower end of the guidance range, while full year gold production is expected to be within the guidance ranges.

In Manitoba, we expect the strong operating performance to continue into the fourth quarter, and full year gold production is now expected to exceed the top end of the guidance range and full year copper production is expected to trend towards the higher end of the guidance range.

We are again improving our full-year 2024 consolidated cash cost guidance range to $0.65 to $0.85 per pound copper from the previously announced range of $0.90 to $1.10 per pound and the original guidance range of $1.05 to $1.25 per pound. We are also improving our 2024 annual consolidated sustaining cash cost guidance range to $1.75 to $2.20 per pound copper from the original guidance range of $2.00 to $2.45 per pound. This is a result of increased exposure to gold by-product credits and continued strong cost control at all operations. We have reaffirmed all other 2024 guidance metrics.

Continued Debt Reduction and Improved Balance Sheet Flexibility

We took several prudent measures in the third quarter of 2024 to further improve our balance sheet strength and flexibility:

• Repurchased and retired an additional $48.5 million of senior unsecured notes - We made open market purchases of $13.4 million of the 2026 senior unsecured notes and $35.1 million of the 2029 senior unsecured notes during the quarter. As a result, a total of $82.6 million of senior unsecured notes have been repurchased and retired since the beginning of the year.

• Delivered the final $16.9 million under gold forward sale and prepay agreement - We completed the last monthly gold delivery in August 2024, resulting in the full repayment of the gold prepay facility which was used to fund the refurbishment of the New Britannia gold mill.

• Three-year extension of revolving credit facilities to 2028 - Subsequent to the quarter end, we proactively extended our senior secured revolving credit facilities by three years from October 2025 to November 2028 and negotiated the flexibility to leave our 4.50% 2026 senior unsecured notes outstanding to maturity as we advance Copper World towards a sanctioning decision in accordance with the 3-P plan. The newly extended $450 million revolving credit facility, with the existing banking syndicate, includes an improved pricing grid reflecting the enhanced financial position of Hudbay, and features an opportunity to increase the facility by an additional $150 million at our discretion during the four-year tenor, providing additional financial flexibility. The revolving credit facilities are currently undrawn (excluding letters of credit), having repaid $100 million of prior drawings associated with the Copper Mountain acquisition in the first half of 2024.

We have delivered five consecutive quarters of meaningful free cash flow generation as a result of recent brownfield investments in our operations, continuous improvement efforts and steady cost control across the business. During the last twelve months, we have repaid a total of $296 million of debt and gold prepayment liabilities.

As a result of continued deleveraging efforts and cash flow generation, we have substantially reduced net debt^1^ to $625.6 million at September 30, 2024, from $1,037.7 million at the end of 2023. The net debt reduction, together with higher levels of adjusted EBITDA^1^ over the last twelve months, has significantly improved our net debt to adjusted EBITDA ratio^1^ to 0.7x compared to 1.6x at the end of 2023. The improved balance sheet flexibility and accelerated debt reduction significantly advances the Company's progress as part of its 3-P plan for sanctioning Copper World, and results in the successful achievement of the targeted 1.2x net debt to 12 month trailing adjusted EBITDA^1^ ratio well ahead of schedule.

Advancing Permitting at Copper World

In August 2024, Hudbay received the Aquifer Protection Permit for the Copper World project from the Arizona Department of Environmental Quality ("ADEQ"). The Company proactively engaged with the ADEQ, ensuring a transparent and thorough permitting process by providing comprehensive and detailed information. The issuance of this permit is a key milestone in the advancement of Copper World, which is a standalone operation requiring state and local permits and is expected to produce 85,000 tonnes of copper per year over a 20-year mine life.

There are three key state permits required for Copper World sanctioning:

• Mined Land Reclamation Plan - Completed ****** - the Mined Land Reclamation Plan was initially approved by the Arizona State Mine Inspector in October 2021 and was subsequently amended and approved to reflect a larger private land project footprint. This approval was challenged in state court, but the challenge was dismissed in May 2023.

• Aquifer Protection Permit - Completed ***** -* the Aquifer Protection Permit was received on August 29, 2024 from the ADEQ following a robust process that included detailed analysis by the agency and Hudbay, along with a public comment period that was completed in the second quarter of 2024.

• Air Quality Permit - On Track - the Air Quality Permit application was submitted to the ADEQ in late 2022 and follows a similar robust process, including a public comment period that concluded in September 2024.

With the receipt of the Aquifer Protection Permit on August 29, 2024, we announced that we commenced activities related to the preparation of feasibility studies for Copper World, resulting in an expected $25 million increase in growth capital spending in Arizona, compared to the original annual guidance of $20 million.

We intend to commence a minority joint venture partner process after receiving the Air Quality Permit. The potential joint venture partner is anticipated to participate in the funding of definitive feasibility study activities in 2025 as well as in the final project design and construction for Copper World.

The opportunity to sanction Copper World is not expected until 2026 based on current estimated timelines. Once in production, Copper World is expected to be a meaningful copper producer in the U.S. domestic copper supply chain, which will be required to help secure growing U.S. metal demand related to increased manufacturing capacity, infrastructure development, increased energy independence and domestic battery supply chain and production needs. The "Made-in-America" copper cathode anticipated to be produced at Copper World is expected to be sold entirely to domestic U.S. customers and would make Copper World the third largest cathode producer in the U.S. Hudbay is pleased with the level of local support received at the public comment meetings and looks forward to providing significant social and environmental benefits for the community and local economy in Arizona. Over the proposed initial 20-year mine life, the company expects to contribute more than $850 million in U.S. taxes, including approximately $170 million in taxes to the state of Arizona. Hudbay also expects Copper World to create more than 400 direct jobs and up to 3,000 indirect jobs in Arizona.

_________________________________________ ^1^ Adjusted EBITDA and net debt to adjusted EBITDA ratio are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

Copper Mountain Stabilization Complete and Optimization Initiatives Underway

Stabilization Phase Completed

Since acquiring Copper Mountain in June 2023, our stabilization efforts have been focused on ramping up the mining fleet to execute a planned accelerated stripping campaign to gain access to higher grades, as well as plant improvement initiatives to improve mill reliability and recoveries.

• Mine Ramp-up Activities Completed - Successfully remobilized all 28 haul trucks and added five additional haul trucks this year to execute the planned three-year accelerated stripping campaign at a lower cost and avoid contractor mining costs.

• Mill Stabilization Activities Completed - Implemented several mill initiatives, including reprogramming the mill expert system, installing advanced grinding control instrumentation, flotation operational strategy improvements and improved maintenance practices. This has resulted in record mill availability of 95% and record copper recovery of 84% being achieved in the third quarter of 2024.

• Operating Costs Stabilized - Achieved sequential quarterly improvements in unit operating costs and cash costs this year with the third quarter of 2024 being the lowest cost quarter at Copper Mountain since Hudbay's acquisition in June 2023.

• Corporate Synergies Target Achieved - Exceeded the targeted $10 million in annualized corporate synergies.

Optimization Phase Underway

Efforts are now focused on several optimization initiatives at Copper Mountain to access higher grades, further improve mill throughput and increase copper production and operating cash flows.

• Accelerated Stripping - Commenced a three-year accelerated stripping program to mitigate the substantially reduced stripping that occurred over the four years prior to Hudbay's acquisition. The stripping program is intended to unlock access to higher grade ore and further benefit operating costs.

• Mill Throughput Optimization - Advancing various engineering studies to increase mill throughput to its permitted levels of 50,000 tonnes per day earlier than was originally contemplated in the technical report, including the potential conversion of the third ball mill to a SAG mill to alleviate capacity limitations.

• On Track to Achieve Three-Year Operating Efficiencies Target - Stabilization initiatives have resulted in improved operating efficiencies, as demonstrated by improved mill throughput, record copper recoveries and lower unit operating costs since Hudbay's acquisition. On track to realize our three-year annual operating efficiencies target of $20 million.

New Britannia Mill Performance Exceeding Expectations and Driving Higher Gold Production

The New Britannia mill has been consistently exceeding performance expectations, achieving throughput levels of 1,650 tonnes per day in 2023, more than 1,850 tonnes per day in the first half of 2024, and reaching a quarterly record of 2,080 tonnes per day in the third quarter of 2024. We completed the brownfield investment in New Britannia in 2021 and refurbished the mill with a nominal capacity of 1,500 tonnes per day to provide additional processing capacity at our Snow Lake operations and allow us to achieve higher gold recoveries of approximately 90% as Lalor transitioned to the higher gold and copper areas of the mine plan. The Snow Lake operations achieved record quarterly gold production in the third quarter of 2024, and we now expect gold production in Manitoba to exceed the top end of the 2024 gold production guidance range of 200,000 ounces.

In August 2024, we completed the final payment under the New Britannia gold prepay facility, which further enhances our exposure to higher gold production in Snow Lake. With approximately two million ounces of contained gold in current mineral reserve estimates and another 1.4 million ounces of contained gold in inferred mineral resources, the New Britannia investment has unlocked significant value in Snow Lake. This could be further enhanced by regional exploration upside and the current strong gold price environment.

In the first quarter of 2024, we received a permit approval to increase the production rate at New Britannia to 2,500 tonnes per day, which will provide the opportunity to process more Lalor ore at the New Britannia mill and create additional processing capacity at Stall for potential new regional discoveries in Snow Lake.

Exploration Update

Large Exploration Drill Program Continues in Snow Lake

Hudbay continues to execute its 2024 exploration program with the goal of extending known mineralization near the Lalor deposit to further extend mine life as well as to find a new anchor deposit within trucking distance of the Snow Lake processing infrastructure. The 2024 program included the largest geophysical program in Hudbay's history in Snow Lake, with surface electromagnetic surveys detecting targets at more than 1,000 metres below surface and covering a 25 square-kilometre area including the Cook Lake claims that had been previously untested by modern deep geophysics.

We had eight drill rigs turning in Snow Lake during the third quarter, including two drills completing follow-up drilling at Lalor Northwest, located within 400 metres of the existing Lalor underground infrastructure. Six drill rigs were testing new geophysical targets and completing follow-up drilling at potential regional satellite deposits at the Cook Lake, Reed, Rail and Bur properties. One of the geophysical targets is a very strong deep anomaly located at Cook Lake North, approximately six kilometres from Lalor. Drilling activities are expected to continue throughout the winter season and assay results are pending.

We continue to advance the development of the exploration drift from the existing Lalor ramp towards the 1901 deposit, and the drift is expected to reach mineralization in early 2025. We plan to conduct definition drilling in 2025 to confirm the optimal mining method, evaluate the orebody geometry and continuity, and convert inferred mineral resources in the gold lenses to mineral reserves. In October, we initiated the development of an adjacent haulage drift to further de-risk future full production from the 1901 deposit in 2027.

Advancing Engineering Work for Flin Flon Tailings Reprocessing

Zinc Plant Tailings - Metallurgical test work continues following positive results from the initial confirmatory drill program completed earlier this year in the section of the tailings facility that was utilized by the zinc plant for 25 years. The results confirmed the grades of precious metals and critical minerals previously estimated from historical zinc plant records. An early economic study to evaluate the opportunity to reprocess the zinc plant tailings has confirmed the potential for a technically viable reprocessing alternative, and further engineering work is underway.

Mill Tailings - We continue to advance metallurgical test work on the opportunity to reprocess Flin Flon mill tailings where 100 million tonnes of tailings were deposited over 90 years. An early economic study on the mill tailings is planned.

Maria Reyna and Caballito Drill Permits Expected in 2025

Hudbay controls a large, contiguous block of mineral rights with the potential to host mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The company commenced early exploration activities at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment applications were submitted for the Maria Reyna property in November 2023 and for the Caballito property in April 2024. The environmental impact assessment (EIA) for Maria Reyna was approved by the government in June 2024 and the Caballito EIA was approved in September 2024. This represents one of several steps in the drill permitting process, which is expected to be completed in 2025.

PERU OPERATIONS REVIEW

Three months ended Nine months ended
Sep. 30,2024 Sep. 30,<br>2023 Sep. 30,2024 Sep. 30,<br>2023
Constancia ore mined^1^ tonnes 3,022,931 1,242,198 10,860,132 8,292,778
Copper % 0.36 0.30 0.31 0.32
Gold g/tonne 0.04 0.04 0.03 0.04
Silver g/tonne 3.20 2.91 2.76 2.56
Molybdenum % 0.02 0.01 0.01 0.01
Pampacancha ore mined^1^ tonnes 1,777,092 5,894,013 5,280,235 9,199,803
Copper % 0.48 0.53 0.50 0.48
Gold g/tonne 0.27 0.30 0.28 0.33
Silver g/tonne 6.23 4.22 4.98 3.94
Molybdenum % 0.01 0.02 0.01 0.02
Total ore mined tonnes 4,800,023 7,136,211 16,140,367 17,492,581
Strip ratio^2^ 2.62 1.36 2.07 1.61
Ore milled tonnes 8,137,248 7,895,109 23,934,171 22,781,885
Copper % 0.32 0.43 0.32 0.36
Gold g/tonne 0.11 0.21 0.11 0.13
Silver g/tonne 3.70 3.75 3.35 3.42
Molybdenum % 0.01 0.02 0.01 0.01
Copper concentrate tonnes 100,462 132,828 304,190 311,072
Concentrate grade % Cu 21.12 21.89 21.37 21.63
Copper recovery % 82.6 85.2 83.6 82.7
Gold recovery % 68.1 74.8 69.2 68.0
Silver recovery % 67.0 73.2 67.4 66.6
Molybdenum recovery % 39.0 37.2 42.7 39.1
Combined unit operating costs^3,4^ $/tonne 12.78 12.20 12.12 12.55

^1^Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

^2^Strip ratio is calculated as waste mined divided by ore mined.

^3^Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

^4^ Combined unit costs is a non-IFRS financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

Three months ended Nine months ended
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Contained metal in concentrate produced
Copper tonnes 21,220 29,081 65,013 67,280
Gold oz 20,331 40,596 60,147 64,800
Silver oz 648,209 697,211 1,738,760 1,669,021
Molybdenum tonnes 362 466 1,128 1,169
Payable metal sold
Copper tonnes 18,803 27,490 59,363 65,013
Gold oz 9,795 32,757 65,905 59,062
Silver oz 365,198 460,001 1,519,207 1,523,740
Molybdenum tonnes 343 426 1,105 994
Cost per pound of copper produced
Cash cost^1^ $/lb 1.80 0.83 1.28 1.34
Sustaining cash cost^1^ $/lb 2.78 1.51 2.08 2.10

^1^ Cash cost and sustaining cash costs per pound of copper produced, net of by-product credits, are not recognized under IFRS. For more detail on these non-IFRS financial performance measures, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

Overview

Peru operations continued to benefit from strong mill throughput, averaging approximately 87,000 tonnes processed per day year-to-date and achieving an average of 88,000 tonnes per day in the third quarter. Cost performance for the nine months ended September 30, 2024 was also strong, despite lower grades milled, achieving lower unit operating costs, cash cost and sustaining cash cost compared to the comparative 2023 period. Cash cost also benefited from higher gold by-product sales revenues throughout 2024.

The planned stripping program at Pampacancha was completed in late September, and mining activities at Pampacancha are now focused on the next mining phase to deliver higher copper and gold grades in the fourth quarter of 2024.

The Company is evaluating opportunities to further increase mill throughput in the medium-to-long-term after the Peruvian Ministry of Energy and Mines approved a regulatory change in June 2024 to allow mining companies in Peru to increase throughput by up to 10% above permitted levels.

Mining Activities

Total ore mined in the third quarter of 2024 decreased by 33% compared to the same period in 2023, in line with our mine plan as we completed the planned stripping program at Pampacancha in late September. Ore mined from Pampacancha during the third quarter decreased to 1.8 million tonnes compared with 5.9 million tonnes in the third quarter of 2023 when we were in an unusually high period of ore mined from Pampacancha as per the 2023 mine plan cadence.

Year-to-date ore mined was 8% lower than the same period in 2023 due to the same factors as the quarterly variance.

Milling Activities

Ore milled during the third quarter of 2024 was 3% higher than the comparative 2023 period mainly due to the treatment of softer ore from stockpiles. Ore milled included supplemental ore feed from stockpiles during the quarter as the team completed pit stripping activities. Milled copper and gold grades decreased by 26% and 48%, respectively, in the third quarter of 2024 compared to the same period in 2023 due to lower amounts of high grade copper and gold from Pampacancha as the stripping campaign was underway, in addition to lower grades from the processing of stockpiled ore.

Ore milled during the first nine months of 2024 was 5% higher than the comparative 2023 period due to the same factors as the quarterly variance. Milled copper and gold grades decreased by 11% and 15%, respectively, in the first nine months of 2024 compared to the same period in 2023 due to the same factors as the quarterly variance.

Recoveries of copper and gold during the third quarter of 2024 were 83% and 68%, respectively, representing a decrease of 3% and 9%, respectively, compared with the same period in 2023 and were in line with our metallurgical models for the ore types that were being processed. Copper and gold recoveries are expected to increase in the fourth quarter as more higher grade ore is processed and less stockpile ore is used to supplement mill feed.

Recoveries of copper, gold and silver during the first nine months of 2024 were 84%, 69% and 67%, representing an increase of 1%, 2%, and 1%, respectively, compared with the 2023 period. This is also in line with our metallurgical models.

Production and Sales Performance

Third quarter 2024 production of copper, gold, silver and molybdenum was 21,220 tonnes, 20,331 ounces, 648,209 ounces and 362 tonnes, respectively, representing a decrease of 27%, 50%, 7% and 22%, respectively, compared with the same period in 2023 due to lower planned grades and recoveries as we completed the planned Pampacancha stripping activities and supplemented mill feed from lower grade stockpiles.

Year-to-date production of copper, gold and molybdenum was 65,013 tonnes, 60,147 ounces, and 1,128 tonnes, respectively, representing a decrease of 3%, 7% and 4%, respectively, from the comparative 2023 period due to the same factors as the quarterly variance. Production of silver was 1,738,760 ounces, representing an increase of 4% from the comparative 2023 period due to higher silver grades from Pampacancha.

Quantities of payable copper, gold and silver sold during the third quarter of 2024 were lower by 32%, 70% and 21%, respectively, than the corresponding period in 2023 primarily due to the same reasons affecting production and the timing of precious metal sales at the end of the quarter.

Year-to-date copper metal sold was 9% lower than the comparable period due to lower copper production levels. Gold metal sold was 12% higher than the comparable period primarily due to timing of precious metal sales at the beginning of the year.

*Copper equivalent production is calculated using the quarter average LME prices for each metal excluding molybdenum.

Cost Performance

Combined mine, mill and G&A unit operating costs in the third quarter were $12.78 per tonne, 5% higher than the same period in 2023 primarily due to higher mining and milling costs following a one-time payment associated with a revised labour agreement. This was partially offset by higher ore milled. Combined mine, mill and G&A unit operating costs in the first nine months of 2024 were $12.12 per tonne, a 3% decrease compared to the same period in 2023 primarily due to lower milling costs and higher ore milled, partially offset by higher mining and G&A costs.

Cash cost per pound of copper produced, net of by-product credits, in the third quarter of 2024 was $1.80, an increase compared to $0.83 in the same period in 2023 due to lower by-product credits mostly as a result of lower gold sales volumes, fewer pounds of copper produced as a result of lower grades, as well as higher mining and milling costs. This was partially offset by lower treatment, refining and freight costs.

On a year-to-date basis, cash costs per pound of copper produced, net of by-product credits was $1.28, a decrease compared to $1.34 in the comparable 2023 period due to higher by-product credits, lower treatment and refining costs and lower milling costs. This was partially offset by higher profit sharing, higher mining cost, and lower pounds of copper produced.

Sustaining cash cost per pound of copper produced, net of by-product credits, was $2.78 in the third quarter, an increase compared to $1.51 in the same period in 2023 for the same factors as described for the cash cost variance above. On a year-to-date basis, sustaining cash cost per pound of copper produced, net of by-products, was consistent with the comparable period in 2023.

Peru Guidance Outlook

Three months ended Nine months ended Guidance
Sep. 30,2024 Sep. 30,<br>2023 Sep. 30,2024 Sep. 30,<br>2023 Annual 2024
Contained metal in concentrate produced
Copper tonnes 21,220 29,081 65,013 67,280 98,000 - 120,000
Gold oz 20,331 40,596 60,147 64,800 76,000 - 93,000
Silver oz 648,209 697,211 1,738,760 1,669,021 2,500,000 - 3,000,000
Molybdenum tonnes 362 466 1,128 1,169 1,250 - 1,500
Cost per pound of copper produced
Cash cost^1^ $/lb 1.80 0.83 1.28 1.34 1.25 - 1.60

^1^ Cash cost per pound of copper produced, net of by-product credits, are not recognized under IFRS. For more detail on these non-IFRS financial performance measures, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

We expect to achieve our 2024 production and cost guidance range for all metals in Peru as the fourth quarter is expected to be the strongest quarter in Peru in 2024. We expect Peru 2024 full year copper production to trend towards the lower end of the guidance range due to lower than expected grades, while gold production is expected to trend towards the higher end of the guidance range due to a larger portion of the feed coming from higher gold grade Pampacancha stockpiles. Cash cost is expected to be favourably positioned at the lower end of the cost guidance range primarily due to high gold by-product credits.

MANITOBA OPERATIONS REVIEW

Three months ended Nine months ended
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Lalor ore mined tonnes 411,295 367,491 1,204,481 1,154,345
Gold g/tonne 5.45 5.08 4.70 4.35
Copper % 0.91 1.02 0.82 0.80
Zinc % 2.73 3.31 2.80 3.25
Silver g/tonne 30.45 27.80 25.46 23.08
New Britannia ore milled tonnes 191,298 146,927 529,606 431,874
Gold g/tonne 6.77 6.93 6.39 6.27
Copper % 0.93 1.22 1.00 0.87
Zinc % 1.12 0.90 0.96 0.84
Silver g/tonne 30.24 23.88 25.62 24.01
Copper concentrate tonnes 10,856 10,313 31,853 21,997
Concentrate grade % Cu 15.18 16.93 15.70 16.06
Gold recovery^1^ % 90.0 88.8 89.5 88.5
Copper recovery % 92.8 97.4 94.5 94.3
Silver recovery^1^ % 79.9 82.0 81.4 80.8
Contained metal in concentrate produced
Gold oz 24,355 21,189 68,000 53,038
Copper tonnes 1,648 1,745 5,001 3,531
Silver oz 114,157 71,290 277,132 202,193
Metal in doré produced^2^
Gold oz 16,768 14,403 44,106 26,095
Silver oz 42,244 39,926 118,977 62,735
Stall ore milled tonnes 222,621 255,516 671,506 736,768
Gold g/tonne 4.23 3.70 3.44 3.21
Copper % 0.89 0.77 0.71 0.74
Zinc % 4.12 4.88 4.23 4.72
Silver g/tonne 30.20 28.82 25.43 22.81
Copper concentrate tonnes 8,438 9,036 21,807 23,962
Concentrate grade % Cu 20.74 20.32 19.20 20.41
Zinc concentrate tonnes 15,338 19,431 48,456 55,046
Concentrate grade % Zn 52.61 52.97 51.50 52.50
Gold recovery % 70.5 67.8 68.3 63.7
Copper recovery % 88.3 93.9 88.5 89.8
Zinc recovery % 88.1 82.6 87.9 83.0
Silver recovery % 57.8 64.9 57.4 61.3
Contained metal in concentrate produced
Gold oz 21,345 20,621 50,681 48,367
Copper tonnes 1,750 1,835 4,188 4,888
Zinc tonnes 8,069 10,291 24,954 28,895
Silver oz 124,996 153,536 315,758 331,216

^1^Gold and silver recovery includes total recovery from concentrate and doré.

^2^Doré includes sludge, slag and carbon fines.

Three months ended Nine months ended
Sep. 30,2024 Sep. 30,<br>2023 Sep. 30,2024 Sep. 30,<br>2023
Total contained metal in concentrate and doré produced^1^
Gold oz 62,468 56,213 162,787 127,500
Copper tonnes 3,398 3,580 9,189 8,419
Zinc tonnes 8,069 10,291 24,954 28,895
Silver oz 281,397 264,752 711,867 596,144
Payable metal sold in concentrate and doré
Gold oz 57,238 36,713 162,004 107,662
Copper tonnes 2,931 2,925 8,281 7,021
Zinc tonnes 8,607 7,125 19,859 21,394
Silver oz 244,974 197,952 674,301 481,547
Unit Operating Costs^2^
Lalor C$/tonne 132.97 151.14 143.10 140.81
New Britannia C$/tonne 66.14 91.07 71.66 85.80
Stall C$/tonne 46.72 36.56 41.92 35.46
Combined mine/mill unit operating costs^3,4^ C$/tonne 211 217 224 218
Cost per ounce of gold produced
Cash cost^4^ $/oz 372 670 606 864
Sustaining cash cost^4^ $/oz 553 939 855 1,212

^1^ Metal reported in concentrate is prior to deductions associated with smelter terms.

^2^ Reflects costs per tonne of ore mined/milled.

^3^ Reflects combined mine, mill and G&A costs per tonne of milled ore.

^4^ Combined unit costs, cash cost and sustaining cash cost per ounce of gold produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

Overview

The Snow Lake operations in Manitoba delivered record production results during the third quarter of 2024, continuing to exceed expectations in performance and efficiency.

Performance from the Lalor mine was strong, benefiting from improved longhole muck fragmentation and a consistent higher-grade mining sequence that surpassed forecasted metal grades. In August, we successfully completed a five-day planned maintenance program aimed at enhancing the efficiency and reliability of our key infrastructure at the mine. Ongoing modifications to stope design further enhanced mucking efficiency throughout the lifecycle of stopes.

The New Britannia mill had another quarter of exceptional performance with the mill operating consistently above name plate capacity of 1,500 tonnes per day and achieving a new quarterly production record with an average throughput of 2,080 tonnes per day in the third quarter. Plant availability continues to improve, supported by low-capital projects aimed at further increasing throughput while continuing to achieve targeted gold recoveries of 90%. These efforts align with our long-term objectives of maximizing gold production by processing more high-grade ore from Lalor through the New Britannia mill, leading to higher gold recoveries. Notably, enhancements in the elution and stripping cycles contributed to increased gold doré production.

At the Stall mill, there was a slight reduction in throughput as more ore was diverted to New Britannia. Benefits from recent recovery improvement programs continue to be realized with gold recoveries of 71% and 68% achieved in the third quarter and year-to-date, respectively, compared to 64% in the first nine months of 2023. Efforts to continue to optimize recovery were advanced with the installation of new elongated cyclones in one of the two milling circuits late in third quarter. These cyclones are designed to improve grind size and, pending positive performance results, could be implemented across other circuits. Additionally, transitioning operational and maintenance responsibilities for the external crusher from contractors to the in-house team has resulted in more efficient cost management, supporting long-term savings at the Snow Lake operations.

Progress on the 1901 exploration drift is on track to intersect mineralization by early 2025, laying the groundwork for the 1901 haulage drift that will support full production from the 1901 deposit by 2027. Diamond drilling will soon follow to evaluate the orebody and optimize the mining approach for future conversion of inferred mineral resources into mineral reserves.

Environmental initiatives continue to progress well in Manitoba. At the Anderson tailings facility, enhanced deposition efficiency enabled deferral of dam construction capital to future years, while a new trial exploring alternative shore deposition techniques shows potential for further gains in efficiency. The operations remain on track to meet their environmental targets for 2024, with significant reductions in propane and diesel consumption achieved year-to-date compared to 2023. In addition, an initiative at Lalor to recycle natural groundwater for use as process water has successfully reduced the mine's reliance on fresh water.

Mining Activities

Total ore mined in Manitoba in the third quarter of 2024 was 12% higher than the comparable quarter in 2023. Gold and silver grades mined at Lalor during the third quarter were 7% and 10% higher, respectively, compared with the same period in 2023. Copper and zinc grades mined at Lalor during the third quarter were 11% and 18% lower, respectively, compared with the same period in 2023. The third quarter of 2024 saw significant improvements in ore production and precious metal grade quality. These changes align with improvements in mining techniques, most notably in longhole muck fragmentation, and anticipated higher grade precious metal sequences as part of the mine plan for the quarter.

Total ore mined at our Manitoba operations during the first nine months of 2024 was 4% higher than the same period in 2023. Gold, copper and silver grades mined at Lalor during the first nine months of 2024 were 8%, 3% and 10% higher, respectively, compared with the same period in 2023, consistent with the mine plan. Zinc grades mined at Lalor during the first nine months of 2024 were 14% lower than the same period in 2023.

Milling Activities

Consistent with our strategy of allocating more Lalor ore feed to New Britannia, the New Britannia mill throughput averaged approximately 2,080 tonnes per day in the third quarter of 2024, approximately 30% above average daily throughput levels in the same period in 2023. Recoveries of gold, copper and silver in the third quarter of 2024 were 90%, 93% and 80%, respectively, representing an increase of 1%, and a decrease of 5% and 3%, respectively, compared to the same period in 2023. Year-to-date total ore milled at New Britannia was 23% higher than the prior period for the same reason. With the higher ore grade processed, precious metals recoveries also increased by 1% year-to-date compared to the same period in 2023.

During the three and nine months ended September 30, 2024, the Stall mill processed 13% and 9% less ore, respectively, compared with the same period in 2023, which is aligned with our strategy of allocating more Lalor ore feed to New Britannia, as noted above. The Stall mill achieved gold recoveries of 71% in the third quarter, reflecting benefits from recent recovery improvement programs as higher gold grade ore is processed.

Production and Sales Performance

Manitoba operations achieved a new quarterly record for gold production at 62,468 ounces in the third quarter of 2024. The operations also produced 3,398 tonnes of copper, 8,069 tonnes of zinc and 281,397 ounces of silver during the third quarter of 2024. Compared to the third quarter of 2023, production of gold and silver in the third quarter of 2024 increased by 11% and 6%, respectively, while production of copper and zinc declined by 5% and 22%, respectively. The increased gold and silver production in the quarter is mainly due to our strategy of mining and allocating more Lalor gold ore feed to New Britannia to achieve higher recoveries, which resulted in planned lower production of copper and zinc.

Production of gold, copper and silver in the first nine months of 2024 was higher by 28%, 9% and 19%, respectively, than the comparative 2023 period mainly due to the same reasons as noted above, as well as higher production from copper-gold zones in the first quarter of 2024. Zinc production in the first nine months of 2024 decreased by 14%, aligned with forecasted production and strategy to mine more gold ore at Lalor.

Quantities of payable metal during the third quarter of 2024 were higher than the comparable periods in 2023 for all metals sold, primarily due to the same factors impacting contained metal production, as noted above. For the nine months ended September 30, 2024, payable metals sold for gold, copper and silver were higher than the comparable period, while zinc metal sold was lower than the comparable period.

Cost Performance

Lalor mining costs during the third quarter of 2024 decreased by 12% compared to the same period in 2023, achieving the lowest cost in the past 2 years, despite inflationary factors over that period, as a result of efficiency improvements and higher tonnage mined. Compared to the same period in 2023, milling costs at the Stall mill were 28% higher during the third quarter of 2024, primarily due to lower throughput as described earlier. New Britannia milling costs decreased by 27% during the third quarter of 2024 versus the same period in 2023, primarily a result of higher throughput as described earlier. Combined mine, mill and G&A unit operating costs in the third quarter of 2024 were C$211 per tonne, representing a 3% decrease compared to the same period in 2023. Combined mine, mill and G&A unit operating costs in the first nine months of 2024 increased by 3% to C$224 per tonne. The marginal increase in combined operating costs year-over-year was the result of higher administrative costs and longer haulage distances, which were partially offset by the effect of higher total throughput.

Cash cost per ounce of gold produced, net of by-product credits, in the third quarter of 2024 was $372, a decrease of 44% compared to the same period in 2023 due to significantly higher gold production and higher by-product credits, partially offset by higher G&A costs.

Sustaining cash cost per ounce of gold produced, net of by-product credits, in the third quarter of 2024 was $553, a decrease of 41% compared to the same period in 2023, primarily due to the same factors affecting cash cost and lower sustaining capital costs during the quarter.

Cash cost per ounce of gold produced, net of by-product credits, in the first nine months of 2024 was $606 per ounce. These costs were 30% lower compared to the same period in 2023 primarily due to higher gold production and by-product credits, partially offset by higher mining, milling and G&A costs resulting from higher employee profit sharing costs. Sustaining cash cost per ounce of gold produced, net of by-product credits, for the first nine months of 2024 was $855 per ounce, a decrease of 29% from the comparative 2023 period primarily due to the same factors affecting cash cost noted above, with lower sustaining capital expenditures compared to the prior year.

Manitoba Guidance Outlook

Three months ended Nine months ended Guidance
Sep. 30, <br>2024 Sep. 30,<br>2023 Sep. 30, <br>2024 Sep. 30,<br>2023 Annual 2024
Total contained metal in concentrate and doré produced^1^
Gold^2^ oz 62,468 56,213 162,787 127,500 170,000 - 200,000
Copper tonnes 3,398 3,580 9,189 8,419 9,000 - 12,000
Zinc tonnes 8,069 10,291 24,954 28,895 27,000 - 35,000
Silver^3^ oz 281,397 264,752 711,867 596,144 750,000 - 1,000,000
Cost per ounce of gold produced
Cash cost^4^ $/oz 372 670 606 864 700 - 900

^1^ Metal reported in concentrate is prior to deductions associated with smelter terms.

^2^Gold production guidance includes gold contained in concentrate produced and gold in doré.

^3^ Silver production guidance includes silver contained in concentrate produced and silver in doré.

^4^ Combined unit costs, cash cost per ounce of gold produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

We now expect to exceed the top end of the 2024 gold production guidance range in Manitoba driven by outperformance at New Britannia with throughput achieving new record levels and the Lalor mine delivering better-than-expected gold grades by focusing on ore quality improvements. We also expect copper production to trend towards the higher end of the 2024 guidance range, and we are well on track to achieve zinc and silver 2024 production guidance. Similarly, we expect 2024 gold cash cost to be favourably positioned at the lower end of the cost guidance range, reflecting the strong cost control and gold production achieved to date.

BRITISH COLUMBIA OPERATIONS REVIEW

Three months ended Nine months<br>ended^5^ Since<br>acquisition to^5^
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Ore mined^1^ tonnes 3,098,863 3,792,568 8,986,081 4,347,991
Strip ratio^2^ 6.05 2.96 5.62 2.90
Ore milled tonnes 3,363,176 3,158,006 9,775,752 3,600,261
Copper % 0.24 0.36 0.25 0.36
Gold g/tonne 0.09 0.08 0.08 0.08
Silver g/tonne 0.73 1.40 0.97 1.36
Copper concentrate tonnes 28,049 39,068 87,974 44,629
Concentrate grade % Cu 24.0 23.8 23.3 23.8
Copper recovery % 84.1 80.9 83.2 80.5
Gold recovery % 67.3 56.1 62.2 57.5
Silver recovery % 71.2 71.3 72.6 72.2
Combined unit operating costs^3,4^ C$/tonne 15.58 24.88 19.56 21.82

^1^Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

^2^Strip ratio is calculated as waste mined divided by ore mined.

^3^Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

^4^ Combined unit costs is a non-IFRS financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

^5^ Copper Mountain mine results are stated at 100%. Hudbay owns 75% of Copper Mountain mine. As Copper Mountain was acquired on June 20, 2023, the results for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

Three months ended Nine months<br>ended^2^ Since<br>acquisition to^2^
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Contained metal in concentrate produced
Copper tonnes 6,736 9,303 20,479 10,542
Gold oz 6,274 4,608 15,145 5,353
Silver oz 55,963 101,069 221,566 112,987
Payable metal sold
Copper tonnes 6,026 8,956 19,523 8,956
Gold oz 6,199 5,329 14,699 5,329
Silver oz 53,241 91,002 205,789 91,002
Cost per pound of copper produced
Cash cost^1^ $/lb 1.81 2.67 2.67 2.36
Sustaining cash cost^1^ $/lb 5.06 3.39 5.15 2.99

^1^ Cash cost and sustaining cash cost, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

^2^ Copper Mountain mine results are stated at 100%. Hudbay owns 75% of Copper Mountain mine. As Copper Mountain was acquired on June 20, 2023, the results for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

Overview

Since acquiring Copper Mountain in June 2023, Hudbay has been focused on advancing operational stabilization plans, including opening up the mine by re-activating the full mining fleet, adding additional mining faces, optimizing the ore feed to the plant and implementing plant improvement initiatives that mirror Hudbay's successful processes at Constancia. These stabilization plans have successfully increased the total tonnes moved and resulted in stronger mill performance as demonstrated by record high mill availability of 95% and above-target copper recoveries of 84% in the third quarter of 2024. As a result, year-to-date mill performance has resulted in the highest mill availability and highest copper recoveries achieved at Copper Mountain mine in the last decade. Similarly, the stabilization efforts have successfully reduced combined unit operating costs to C$19.56 per tonne year-to-date, compared to C$21.38 per tonne milled in second half of 2023 (or first six months since acquisition).

Efforts are now focused on optimizing the operations throughout the balance of 2024 and into 2025. Mining activities will continue to execute the three-year accelerated stripping program intended to bring higher grade ore into the mine plan. Feasibility engineering has commenced to debottleneck and increase the nominal plant capacity to its permitted capacity of 50,000 tonnes per day earlier than contemplated in the most recent technical report.

Mining Activities

Total ore mined at Copper Mountain in the third quarter of 2024 was 3.1 million tonnes, a decrease of 18% compared to the third quarter of 2023. As planned, ore stockpiles were utilized as ore feed to the mill while the mine operation team increased waste stripping activities. Total material moved continued to ramp up in the quarter to 23.0 million tonnes, compared to 16.5 million tonnes in the same period last year, as a result of effective usage of the mining fleet to execute the accelerated stripping program to access higher head grades. The focus in the third quarter of 2024 was on mining efficiencies and operator recruitment to effectively utilize the available haul trucks fleet. As a result, total material moved is expected to continue to increase quarter-over-quarter as per the mine plan.

Milling Activities

The mill processed 3.4 million and 9.8 million tonnes of ore during the third quarter and first nine months of 2024, respectively. Ore processed in the third quarter of 2024 was 6% higher than the third quarter of 2023 benefiting from stabilization and reliability initiatives within the mill processing circuit. The average mill availability during the third quarter of 2024 increased to 95%, while maintaining a stable throughput rate. Mill throughput in the third quarter of 2024 was limited by unplanned maintenance and elevated clay material which impacted the second crushing circuit. During the third quarter, a number of initiatives were advanced to address these issues and other identified constraints and to improve throughput to targeted levels, with the benefits expected to be realized in the fourth quarter of 2024. Several mill initiatives have been implemented this year, including reprogramming the mill expert system, installation of advanced semi-autogenous grinding control instrumentation, redesign of the SAG liner package and updated operational procedures intended to remove magnetite from the pebble stream.

Milled copper grades during the third quarter of 2024 were 33% lower than the third quarter of 2023 as we continued to draw on stockpiled ore. Copper recoveries of 84.1% were higher than the third quarter of 2023, exceeding our expectations despite processing lower grades as the operations improved the regrind circuit constraint and implemented the flotation operational strategy improvements, including reagent selection and dose modification. Similarly, milled gold grades were higher in the third quarter of 2024 than the same period in 2023, resulting in higher gold recoveries of 67.3% in the third quarter of 2024.

Production and Sales Performance

During the third quarter of 2024, production of copper, gold and silver was 6,736 tonnes, 6,274 ounces and 55,963 ounces, respectively. Production of copper and silver decreased by 28% and 45%, respectively, compared to the third quarter of 2023 primarily as a result of lower head grades from the use of stockpiled ore to feed the mill. Gold production increased by 36% compared to the third quarter of 2023 due to higher gold grades and recoveries.

During the first nine months of 2024, production of copper, gold and silver was 20,479 tonnes, 15,145 ounces and 221,566 ounces, respectively.

*Copper equivalent production is calculated using the quarter average LME prices for each metal excluding molybdenum.

** Copper Mountain mine production are stated at 100%. Hudbay owns 75% of Copper Mountain mine.

Cost Performance

Combined mine, mill and G&A unit operating costs in the third quarter of 2024 were C$15.58 per tonne milled, 34% lower than the third quarter of 2023. This is primarily due to lower mining costs as there were high ore rehandling costs in the third quarter of 2023, higher ore milled and the benefits from the various stabilization initiatives implemented over the course of this year. Combined unit operating costs are expected to continue to benefit from the execution of our accelerated stripping program and implementation of our optimization initiatives at Copper Mountain.

Combined mine, mill and G&A unit operating costs for the first nine months of 2024 were C$19.56 per tonne milled versus C$21.82 per tonne milled in second half of 2023 (or first six months since acquisition).

Cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, in the third quarter of 2024 were $1.81 and $5.06, respectively. Cash cost was 32% lower than in the third quarter of 2023 for the same reasons as mentioned above regarding the unit cost variance. Sustaining cash costs were 49% higher than the third quarter of 2023 mainly as a result of planned higher capitalized stripping costs in order to arrive at higher grade ore, in accordance with our accelerated stripping program.

Cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, in the first nine months of 2024 were $2.67 and $5.15, respectively.

British Columbia Guidance Outlook

Three months ended Nine months<br>ended^2^ Since<br>acquisition to^2^ Guidance
Sep. 30,2024 Sep. 30,<br>2023 Sep. 30, 2024 Sep. 30, 2023 Annual 2024
Contained metal in concentrate produced
Copper tonnes 6,736 9,303 20,479 10,542 30,000 - 44,000
Gold oz 6,274 4,608 15,145 5,353 17,000 - 26,000
Silver oz 55,963 101,069 221,566 112,987 300,000 - 455,000
Cost per pound of copper produced
Cash cost^1^ $/lb 1.81 2.67 2.67 2.36 2.00 - 2.50

^1^ Cash cost, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.

^2^ Copper Mountain mine results are stated at 100%. Hudbay owns 75% of Copper Mountain mine. As Copper Mountain was acquired on June 20, 2023, the results for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

We expect to be slightly below the low end of our 2024 guidance range for copper production in British Columbia as a result of lower grades in stockpiled ore and the ramp-up of stabilization efforts throughout the year. We expect gold and silver production to be within the 2024 guidance range in British Columbia. Cash cost for the nine months ended September 30, 2024 was above the higher end of our 2024 guidance range; however, we expect fourth quarter cash cost to continue to improve our anticipated full year cash cost towards the upper end of the 2024 cost guidance range.

FINANCIAL REVIEW

Financial Results

In the third quarter of 2024, we recorded net earnings attributable to owners of $49.8 million compared to net earnings on the same basis of $45.1 million in the third quarter of 2023, representing an increase in net earnings attributable to owners of $4.7 million. Year-to-date in 2024, we recorded net earnings attributable to owners of $55.5 million compared to net earnings on the same basis of $35.7 million for the same period in 2023, representing an increase earnings attributable to owners of $19.8 million.

The following table provides further details on the makeup of this variance:

(in $ millions) Three months ended<br><br> <br>September 30, 2024 Nine months ended<br><br> <br>September 30, 2024^1^
Increase (decrease) in components of earnings:
Revenues 5.3 348.5
Cost of sales
Mine operating costs 11.8 (140.4)
Depreciation and amortization 16.3 (34.5)
Selling and administrative expenses (1.9) (19.2)
Exploration expenses (7.5) (12.5)
Re-evaluation adjustment - environmental obligation (34.4) (39.4)
Other expenses 1.0 (7.5)
Net finance expense 4.9 (17.9)
Tax expense 9.4 (64.6)
Increase in net earnings for the period 4.9 12.5
Change in non-controlling interest (0.2) 7.3
Increase in net earnings attributable to owners for the period 4.7 19.8
^1^Copper Mountain mine results are stated at 100%. Hudbay owns 75% of Copper Mountain mine. As Copper Mountain was acquired on June 20, 2023, the results for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

Revenue

Revenue for the third quarter of 2024 was $485.8 million, $5.3 million higher than the same period in 2023, primarily as a result of higher metal prices and higher zinc sales volumes, partially offset by lower copper sales volumes in Peru due to lower grades in the third quarter of 2024 as a planned stripping program was completed at Pampacancha in 2024.

Revenue for the first nine months of 2024 was $1,436.3 million, $348.5 million higher than the same period in 2023, primarily as a result of higher metal prices, higher gold and silver sales volumes and incremental revenue as a result of the Copper Mountain mine acquisition.

While a majority of revenues continue to be from copper, gold is representing an increasing portion of total revenues at 36% in the third quarter of 2024 and 33% year-to-date, compared to 27% and 26% in 2023, respectively. This is as a result of higher gold production and strong leverage higher gold prices in 2024, increasing commodity diversification and improving overall revenues.

The following table provides further details on these variances:

(in $ millions) Three months ended<br><br> <br>September 30, 2024 Nine months ended<br><br> <br>September 30, 2024
Metals prices^1^ ****
Higher copper prices 29.7 49.3
Higher gold prices 62.3 95.0
Higher zinc prices 3.6 1.5
Higher silver prices 3.5 5.9
Sales volumes
(Lower) higher copper sales volumes (96.4) (61.5)
(Lower) higher gold sales volumes (2.5) 111.5
Higher (lower) zinc sales volumes 3.5 (4.0)
(Lower) higher silver sales volumes (1.9) 3.2
British Columbia Business Unit^2^
Copper - 129.6
Gold - 19.8
Silver - 4.3
Treatment & Refining - (7.7)
Other
Molybdenum and other volume and pricing differences (8.2) (4.0)
Variable consideration adjustments - (8.7)
Effect of lower treatment and refining charges 11.7 14.3
Increase in revenue in 2024 compared to 2023 5.3 348.5
^1^ See discussion below for further information regarding metals prices.
^2^Represents revenue for the period of January 1, 2024 through to June 30, 2024, where there was no comparable revenue in the comparative period due to the fact Copper Mountain mine was acquired on June 20, 2023.

Our revenue by significant product type is summarized below:

Three months ended Nine months ended
(in $ millions) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Copper 261.3 334.1 805.8 704.1
Gold 176.4 128.4 474.0 279.2
Zinc 24.2 17.8 54.7 57.9
Silver 12.7 10.3 35.8 23.8
Molybdenum 16.8 22.4 51.0 58.2
Other metals - - 0.5 0.2
Revenue from contracts 491.4 513.0 1,421.8 1,123.4
Amortization of deferred revenue - gold 4.3 10.2 26.2 23.4
Amortization of deferred revenue - silver 5.3 6.6 22.0 22.5
Amortization of deferred revenue - variable consideration adjustments - prior periods - - (3.9) 4.9
Pricing and volume adjustments^1^ 6.0 (16.4) 41.6 (8.4)
Treatment and refining charges (21.2) (32.9) (71.4) (78.0)
Revenue 485.8 480.5 1,436.3 1,087.8
^1^Pricing and volume adjustments represents mark-to-market adjustments on provisionally prices sales, realized and unrealized changes to fair value for non-hedge derivative contracts (QP hedges) and adjustments to originally invoiced weights and assays.

For further detail on variable consideration adjustments, refer to note 18 of our consolidated interim financial statements.

Realized sales prices

This measure is intended to enable management and investors to understand the average realized price of metals sold to third parties in each reporting period. The average realized price per unit sold does not have any standardized meaning prescribed by IFRS, is unlikely to be comparable to similar measures presented by other issuers and should not be considered in isolation or a substitute for measures of performance prepared in accordance with IFRS.

For sales of copper, zinc, gold and silver we may enter into non-hedge derivatives ("QP hedges") which are intended to manage the provisional pricing risk arising from quotational period terms in concentrate sales agreements. The gains and losses on QP hedges are included in the calculation of realized prices. We expect that gains and losses on QP hedges will offset provisional pricing adjustments on concentrate sales contracts.

Our realized prices for the three and nine months ended September 30, 2024 and 2023, respectively, are summarized below:

Realized prices^1^ for the Realized prices^1^ for the
Three months ended Nine Months Ended
Prices Sep. 30, 2024 Sep. 30, 2023 LME YTD<br>2024^2^ Sep. 30, 2024 Sep. 30, 2023
Copper /lb 4.24 3.76 4.14 4.21 3.87
Zinc /lb 1.28 1.09 1.22 1.23 1.19
Gold^3^ /oz 2,582 1,738 2,206 1,798
Silver^3^ /oz 27.58 22.34 24.76 21.95
^1^Realized prices exclude refining and treatment charges and are on the sale of finished metal or metal in concentrate. Realized prices include the effect of provisional pricing adjustments on prior period sales.
^2^ London Metal Exchange average for Cash copper and zinc prices.
^3^Sales of gold and silver from Constancia mine are subject to our precious metals stream agreement with Wheaton, pursuant to which we recognize deferred revenue for precious metals deliveries and also receive cash payments. Stream sales are included within realized prices and their respective deferred revenue and cash payment rates can be found on page 35 of this MD&A.

All values are in US Dollars.

In addition to QP hedges, we may periodically undertake metal price hedging in accordance with Board approved policies to achieve strategic objectives, including locking in favourable metal prices to ensure minimum cash flows during or after the construction of a mine or during a period of reduced liquidity, to manage cash flows at shorter life or higher cost operations or as part of a financing arrangement. The realized prices, denoted in the table above, exclude the impact of derivative mark-to-market gains and losses on these non-QP hedges, which are included in change in fair value of financial instruments in our consolidated interim statement of earnings. The forward copper sales and zero copper cost collar hedges were entered into in the first quarter of 2024, which represent a total of approximately 50% of Copper Mountain's expected 2024 production.

As of September 30, 2024, Hudbay had the following non-QP hedges outstanding:

  • Forward sales contracts at the Copper Mountain mine for a total of 9.3 million pounds of copper over the period of October 2024 to April 2025 at an average price of $3.95 per pound;

  • Zero-cost collar program at the Copper Mountain mine for 11.6 million pounds of copper over a twelve month period of October 2024 to April 2025 at an average floor price of $3.88 per pound and an average cap price of $4.14 per pound; and

  • Zero-cost collar program for 5,000 ounces of gold production per month over a period of October 2024 to December 2024 at an average floor price of $2,110 per ounce and an average cap price of $2,467 per ounce.

The following tables provide a reconciliation of average realized price per unit sold, by metal, to revenues as shown in the consolidated interim financial statements.

Three months ended September 30, 2024
(in millions) 1 Gold Zinc Silver Molybdenum Other Total
Revenue from contracts 2 176.4 24.2 12.7 16.8 - 491.4
Amortization of deferred revenue 4.3 - 5.3 - - 9.6
Pricing and volume adjustments 3 9.1 - 0.3 (1.7) - 6.0
Revenue, including mark-to-market on QP hedges 4 189.8 24.2 18.3 15.1 - 507.0
Realized non-QP derivative mark-to-market (0.7) - - - - (2.1)
By-product credits 5 189.1 24.2 18.3 15.1 - 504.9
Payable metal in concentrate and doré sold 6 73,232 8,607 663,413 343 - -
Realized price 7 2,582 2,812 27.58 - - -
Realized price 8 - 1.28 - - - -
Nine months ended September 30, 2024
(in millions) 1 Gold Zinc Silver Molybdenum Other Total
Revenue from contracts 2 474.0 54.7 35.8 51.0 0.5 1,421.8
Amortization of deferred revenue 26.2 - 22.0 - - 48.2
Pricing and volume adjustments 3 35.6 (0.9) 1.6 2.3 - 41.6
Revenue, including mark-to-market on QP hedges 4 535.8 53.8 59.4 53.3 0.5 1,511.6
Realized non-QP derivative mark-to-market (0.7) - - - - (4.6)
By-product credits 5 535.1 53.8 59.4 53.3 0.5 1,507.0
Payable metal in concentrate and doré sold 6 242,608 19,859 2,399,297 1,105 - -
Realized price 7 2,206 2,709 24.76 - - -
Realized price 8 - 1.23 - - - -
1 Average realized price per unit sold may not calculate based on amounts presented in this table due to rounding.
2 As per consolidated interim financial statements.
3 Pricing and volume adjustments represents mark-to-market adjustments on provisionally priced sales, realized and unrealized changes to fair value for QP hedge derivative contracts and adjustments to originally invoiced weights and assays.
4 Revenue, including mark-to-market on QP hedges is used in the calculation of realized price.
5 By-product credits subtotal is used in the calculated of cash cost per pound of copper and ounce of gold produced, net of by-product credits. Cash cost per pound of copper and per ounce of gold produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.
6 Copper, zinc and molybdenum shown in metric tonnes and gold and silver shown in ounces.
7 Realized price for copper and zinc in /metric tonne and realized price for gold and silver in /oz.
8 Realized price for copper and zinc in /lb.

All values are in US Dollars.

The price, quantity and mix of metals sold affect our revenue, operating cash flow and gross profit. Revenue from metals sales can vary from quarter to quarter due to production levels, shipping volumes and transfer of risk and title to customers.

Three months ended September 30, 2023
(in millions) 1 Gold Zinc Silver Molybdenum Other Total
Revenue from contracts 2 128.4 17.8 10.3 22.4 - 513.0
Amortization of deferred revenue 10.2 - 6.6 - - 16.8
Pricing and volume adjustments 3 (8.6) (0.7) (0.2) 0.9 - (16.4)
Revenue, including mark-to-market on QP hedges 4 130.0 17.1 16.7 23.3 - 513.4
Realized non-QP derivative mark-to-market 5 - - - - - -
By-product credits 4 130.0 17.1 16.7 23.3 - 513.4
Payable metal in concentrate and doré sold 6 74,798 7,124 748,955 426 - -
Realized price 7 1,738 2,400 22.34 - - -
Realized price 8 - 1.09 - - - -
Nine months ended September 30, 2023
(in millions) 1 Gold Zinc Silver Molybdenum Other Total
Revenue from contracts 2 279.2 57.9 23.8 58.2 0.2 1,123.4
Amortization of deferred revenue 23.4 - 22.5 - - 45.9
Pricing and volume adjustments 3 6.8 (1.6) (0.3) (0.6) - (8.4)
Revenue, including mark-to-market on QP hedges 4 309.4 56.3 46.0 57.6 0.2 1,160.9
Realized non-QP derivative mark-to-market 5 - - - - - -
By-product credits 4 309.4 56.3 46.0 57.6 0.2 1,160.9
Payable metal in concentrate and dore sold 6 172,052 21,393 2,096,289 994 - -
Realized price 7 1,798 2,632 21.95 - - -
Realized price 8 - 1.19 - - - -
1 Average realized price per unit sold may not calculate based on amounts presented in this table due to rounding.
2 As per financial statements.
3 Pricing and volume adjustments represents mark-to-market adjustments on provisionally priced sales, realized and unrealized changes to fair value for non-hedge derivative contracts and adjustments to originally invoiced weights and assays.
4 By-product credits subtotal is used in the calculated of cash cost per pound of copper and ounce of gold produced, net of by-product credits. Cash cost per pound of copper and per ounce of gold produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.
5 Derivative mark-to-market excludes mark-to-market on QP hedges.
6 Copper, zinc and molybdenum shown in metric tonnes and gold and silver shown in ounces.
7 Realized price for copper and zinc in /metric tonne and realized price for gold and silver in /oz.
8 Realized price for copper and zinc in /lb.

All values are in US Dollars.

Stream Sales

The following table shows stream sales included within realized prices and their respective deferred revenue and cash payment rates:

Three months ended Nine months ended
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Gold 5,186 12,399 31,949 28,597
Silver 365,807 434,894 1,513,545 1,475,052
Gold deferred revenue drawdown rate1 817 820 817 820
Gold cash rate2 425 420 422 418
Total gold stream realized price 1,242 1,240 1,239 1,238
Silver deferred revenue drawdown rate1 14.56 15.26 14.56 15.26
Silver cash rate2 6.26 6.20 6.22 6.16
Total silver stream realized price 20.82 21.46 20.78 21.42
1 Deferred revenue drawdown rates for gold and silver do not include variable consideration adjustments.
2 The gold and silver cash rate for Peru increased by 1% from 400/oz and 5.90/oz effective August 4, 2019. Subsequently every year, on August 4, the cash rate will increase by 1% compounded. The gold and silver cash rate for Manitoba increased by 1% from 400/oz and 5.90/oz effective August 1, 2015. Subsequently every year, on August 1, the cash rate will increase by 1% compounded. The weighted average cash rate is disclosed.

All values are in US Dollars.

Subsequent to the variable consideration adjustment recorded on January 1, 2024, the deferred revenue amortization is recorded in Peru at $817/oz gold and $14.56/oz silver (September 30, 2023 - $820/oz gold and $15.26/oz silver).

Cost of Sales

Our detailed cost of sales is summarized as follows:

(in $ thousands) Three months ended Nine months ended
Sep. 30, 2024 Sep. 30, <br>2023 Sep. 30, 2024 Sep. 30, <br>2023
Peru
Mining 37,647 33,875 98,173 92,315
Milling 48,535 46,996 143,494 147,863
Changes in product inventory 1,133 4,137 16,311 20,080
Depreciation and amortization 57,242 80,625 187,132 189,925
G&A 19,928 20,957 62,684 52,305
Inventory adjustments 206 - 206 -
Freight, royalties and other charges 16,247 18,055 48,467 46,050
Total Peru cost of sales 180,938 204,645 556,467 548,538
Manitoba
Mining 40,114 41,421 126,754 120,854
Milling 16,903 16,923 48,601 46,964
Changes in product inventory 1,245 (766) (1,722) (11,004)
Depreciation and amortization 27,662 26,873 79,000 73,665
Inventory adjustments 1,392 - 1,392 906
G&A 12,622 10,249 35,065 26,570
Past service pension costs 2,786 - 2,786 -
Freight, royalties and other charges 7,283 6,121 19,122 16,952
Total Manitoba cost of sales 110,007 100,821 310,998 274,907
British Columbia^1^
Mining 12,918 29,251 60,934 29,251
Milling 19,707 24,102 64,589 24,102
Changes in product inventory (550) 3 6,775 3
Depreciation and amortization 12,548 6,255 38,239 6,255
G&A 5,788 5,050 15,132 5,050
Freight, royalties and other charges 4,631 3,930 13,781 3,930
Total British Columbia cost of sales 55,042 68,591 199,450 68,591
Cost of sales 345,987 374,057 1,066,915 892,036

^1^ Copper Mountain mine results are stated at 100%. Hudbay owns 75% of Copper Mountain mine. As Copper Mountain was acquired on June 20, 2023, the results for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.

Total cost of sales for the third quarter of 2024 was $346.0 million, reflecting a decrease of $28.1 million compared to the third quarter of 2023. British Columbia cost of sales decreased by $13.5 million primarily driven by lower mining and milling costs partially offset by higher depreciation in the quarter. Peru cost of sales decreased by $23.7 million in the third quarter of 2024, compared to the same period of 2023 mainly due to lower drawdown of product inventory versus the comparative 2023 period and lower depreciation in line with the lower production during the quarter. Manitoba cost of sales increased by $9.2 million in the third quarter of 2024, primarily as a result of $2.0 million related to drawdown of finished goods inventory, inventory adjustments for certain materials and supplies inventories and additional profit sharing charges during the quarter, compared to the same period of 2023.

Total cost of sales for the first nine months of 2024 was $1,066.9 million, reflecting an increase of $174.9 million from the same period in 2023 in part due to $130.9 million of 6 months of incremental operating costs from British Columbia. In addition, Peru cost of sales increased by $7.9 million mainly due to higher mining, G&A and freight costs. Manitoba cost of sales increased by $36.1 million as a result of a $9.3 million increase in the relative drawdown of finished goods inventory, $7.8 million increase in profit sharing, and higher mining, milling and depreciation as a result of higher production.

For details on unit operating costs, refer to the respective tables in the "Operations Review" section of this MD&A.

For the third quarter of 2024, other significant variances in non-operating expenses, compared to the same period in 2023, include the following:

  • Net finance expenses decreased by $4.9 million primarily due to a decrease of $5.7 million on mark-to-market losses from investments in junior mining holdings, a decrease of $5.0 million from interest expense on long-term debt benefiting from the retirement of some senior notes, an increase in foreign exchange gain of $2.7 million, an increase of $1.6 million from interest income, a decrease of $1.1 million from withholding taxes, partially offset by an increase of $2.3 million on mark-to-market losses from non-QP hedges and an $8.0 million increase in the relative revaluation loss of the gold prepayment liability.

  • Exploration expenses increased by $7.5 million primarily due to our planned Snow Lake exploration program consisting of modern geophysical programs and multi-phased drilling campaigns, much of which is funded by flow-through financing.

- Re-evaluation adjustment - environmental provision contributed $34.4 million of additional expense compared to the same period of 2023 due to the relative revaluation of the environmental reclamation provision on our Manitoba non-producing sites from changes in long term risk-free discount rates and inflation rates.

Given the long term nature of the reclamation cash flows, the related environmental reclamation provision is highly sensitive to changes in inflation rates and long-term risk-free discount rates and, as such, we may continue to experience significant quarterly environmental reclamation provision revaluations.

For the year-to-date 2024, other significant variances in non-operating expenses, compared to the same period in 2023, included the following:

  • Net finance expenses increased by $17.9 million due to an increase in market-to-market losses of $16.7 million from non-QP hedges, an $8.4 million increase in the relative revaluation loss of the gold prepayment liability, a $4.7 million increase in other finance expenses mostly related to equipment financing, a $2.5 million increase in net foreign exchange loss, partially offset by a decrease in mark-to-market loss of $5.8 million from investments, an increase of $4.4 million in interest income, a $2.0 million decrease in interest expense on long-term debt, and a decrease in the accretion of revenue streaming arrangement of $1.8 million.

  • Selling and administrative expenses increased by **** $19.2 million reflecting a higher share-based compensation expense as a result of a comparative increase in share price during the current period along with incremental selling and administrative expenses incurred by the Copper Mountain mine.

- Other expenses increased by $7.5 million primarily due to an increase of $12.4 million in write-off of previously capitalized PP&E costs, net of capitalized accrued interest, primarily related to an expired option agreement in Arizona and a $6.0 million increase in amortization of certain community costs, partially offset by a decrease of $6.9 million in acquisition costs related to the acquisition of Copper Mountain incurred in 2023 and $3.0 million gain related to the renouncement of flow-through share liability.

  • Exploration expenses increased by $12.5 million primarily due to our planned Snow Lake exploration program consisting of modern geophysical programs and multi-phased drilling campaigns, much of which is funded by flow-through financing.

- Re-evaluation adjustment - environmental provision increased by $39.4 million due to the same reasons as outlined above in the quarterly variance analysis.

Tax Expense

For the three months ended September 30, 2024, tax expense decreased by $9.4 million compared to the same period in 2023. For the nine months ended September 30, 2024 tax expense increased by $64.6 million compared to the same period in 2023. The following table provides further details:

(in $ thousands) Three months ended Nine months ended
Sep. 30, <br>2024 Sep. 30, <br>2023 Sep. 30, <br>2024 Sep. 30, <br>2023
Deferred tax expense (recovery) - income tax^1^ 3,993 1,913 (1,243) (16,371)
Deferred tax (recovery) expense - mining tax^1^ (805) 853 (4,913) (1,217)
Total deferred tax expense (recovery) 3,188 2,766 (6,156) (17,588)
Current tax expense - income tax 11,830 28,131 67,684 37,876
Current tax expense - mining tax 14,329 7,762 37,852 14,545
Total current tax expense 26,159 35,893 105,536 52,421
Tax expense 29,347 38,659 99,380 34,833
^1^Deferred tax expense (recovery) represents our draw down/increase of non-cash deferred income and mining tax assets/liabilities.

Income Tax Expense/Recovery

Applying the estimated Canadian statutory income tax rate of 26.7% to our net earnings before taxes of $147.9 million for year-to-date 2024 would have resulted in a tax expense of approximately $39.5 million; however, we recorded an income tax expense of $66.4 million. The significant items causing our effective income tax rate to be different than the 26.7% estimated Canadian statutory income tax rate include:

  • Deductible temporary differences with respect to Peru, Manitoba and British Columbia, relating to the decommissioning and restoration liabilities, were derecognized as we have determined that it is probable that we will not realize the recovery of these deferred tax assets based on the timing of the reversals of the deductible temporary differences and the future projected taxable profit of the operations. This resulted in a combined deferred tax expense of $8.0 million.

  • Foreign exchange on the translation of deferred tax balances to group currency resulted in a deferred tax expense of $7.1 million.

  • The tax expense with respect to our foreign operations is recorded using an income tax rate other than the Canadian statutory income tax rate of 26.7%, resulting in a tax expense of $20.2 million.

  • New Canadian tax legislation was passed that limits interest and finance expenses to 30% of Tax EBITDA and is applicable for the 2024 tax year. The restricted interest and finance expense ("RIFE") in the year creates a new tax pool that can be used in future years where there is excess capacity available. This tax pool can be carried forward indefinitely. We have not recognized this tax pool. The effect of RIFE limitations of which no deferred tax asset is recognized is equal to $6.7 million.

  • Adjustments with respect to prior years, including an increase in the statutory tax rate owing to a change in provincial allocation, resulting in a deferred tax recovery of $7.3 million.

  • Current mining tax deductions resulting in a deferred tax recovery of $10.7 million.

  • Relinquishment of expenses as part of flow-through share financing resulting in a deferred tax increase of $3.4 million.

Mining Tax Expense

For year-to-date 2024, we recorded a mining tax expense of $33.0 million. Effective mining tax rates can vary significantly based on the composition of our earnings and the expected amount of mining taxable profits. Corporate costs and other costs not related to mining operations are not deductible in computing mining profits. A brief description of how mining taxes are calculated in our various business units is discussed below.

Manitoba

The Province of Manitoba imposes mining tax on earnings related to the sale of mineral products mined in the Province of Manitoba (mining taxable profit) at the following rates:

  • 10% of total mining taxable earnings if mining profit is C$50 million or less;

  • Between mining earnings of C$50 and $C55 million, mining tax is equal to a minimum of C$5 million plus mining earnings less C$50 million multiplied by 65%;

  • 15% of total mining taxable earnings if mining profits are between C$55 million and C$100 million;

  • Between mining earnings of C$100 million and C$105 million, mining tax is equal to a minimum of C$15 million plus mining earnings less C$100 million multiplied by 57%; and

  • 17% of total mining taxable earnings if mining profits exceed C$105 million.

We estimate that the tax rate that will be applicable when temporary differences reverse will be approximately 10.0%.

Peru

The Peruvian government imposes two parallel mining tax regimes, the Special Mining Tax and the Modified Royalty, on companies' operating mining income on a sliding scale, with progressive rates ranging from 2.0% to 8.4% and 1.0% to 12.0%, respectively. Based on financial forecasts, we have recorded a deferred tax liability as at September 30, 2024, at the tax rate we expect to apply when temporary differences reverse.

British Columbia

The Province of British Columbia imposes a 13% net revenue tax on the sale of mineral products mined in the province of British Columbia after the mine owner has recovered the capital invested in the mine and its "Cumulative Expenditure Account" ("CEA") no longer has a balance. The tax is paid on the profit in excess of the capital that has been invested in the mine. British Columbia mineral tax is deductible for federal and provincial income tax purposes.

While there is a balance in the CEA account, the mine owner must pay a "Net Current Proceeds" ("NCP") tax of 2%. Any amounts paid as NCP can then be claimed in the future against net revenue taxes payable.

We estimate that the effective tax rate that will be applicable when temporary differences reverse will be approximately 9.49%.

LIQUIDITY AND CAPITAL RESOURCES

As at September 30, 2024, our liquidity includes $443.3 million in cash, $40.0 million in short-term investments as well as undrawn total availability of $424.4 million under our revolving credit facilities.

Senior Unsecured Notes

During the third quarter of 2024, we purchased $13.4 million of our 4.5% senior notes due April 2026 ("2026 Notes") and $35.1 million of our 6.125% senior notes due April 2029 ("2029 Notes") on the open market. During 2024, we purchased a total $25.0 million of our 2026 Notes and $57.6 million of our 2029 Notes. As at September 30, 2024, we had $575.0 million aggregate principal amount of 2026 Notes and $542.4 million aggregate principal amount of 2029 Notes.

Senior Secured Revolving Credit Facilities

We have two senior secured revolving credit facilities with total commitments of $450 million ("the Credit Facilities") for our Canadian and Peruvian businesses on substantially similar terms and conditions.

During 2024, we fully repaid the $90.0 million of debt outstanding under our Peruvian revolving credit facility. As at September 30, 2024, there were nil draws under the Credit Facilities other than $25.6 million in letters of credit.

As at September 30, 2024, we were in compliance with our covenants under the Credit Facilities.

Subsequent to the quarter end, we proactively extended the Credit Facilities by three years from October 2025 to November 2028 and negotiated the flexibility to leave our 4.50% 2026 senior unsecured notes outstanding to maturity as we advance Copper World towards a sanctioning decision in accordance with the 3-P plan. The newly extended $450 million revolving credit facility, with the existing banking syndicate, includes an improved pricing grid reflecting the enhanced financial position of Hudbay, and features an opportunity to increase the facility by an additional $150 million at our discretion during the four-year tenor, providing additional financial flexibility.

C$130 Million Bilateral Letter of Credit Facility

We have a C$130.0 million bilateral letter of credit facility ("LC Facility") with a major Canadian financial institution. The LC Facility has no financial covenants and enables us to issue up to C$130.0 million of letters of credit to beneficiaries on an unsecured basis at attractive rates, including C$30.0 million sub-limit for financial letters of credit. As at September 30, 2024, the Manitoba business unit had drawn $56.1 million in letters of credit under the LC Facility.

Surety Bonds and Letters of Credit

As at September 30, 2024, the Arizona business unit had $18.4 million in surety bonds issued to support future reclamation and closure obligations and the Peru business unit had $126.1 million in letters of credit issued with various Peruvian financial institutions to support future reclamation and other operating matters. In addition, the British Columbia business unit had $48.6 million in surety bonds issued to support future reclamation and $4.9 million in surety bonds issued to support the hydro used at Copper Mountain mine. The British Columbia business unit also had $0.6 million in cash collateralized letters of credit issued with various Canadian financial institutions related to other operating matters.

Gold Prepayment Liability

During the fourth quarter of 2020, we entered into a gold forward sale and prepay transaction which generated $115.0 million in cash proceeds to pre-fund the expected capital requirements for the New Britannia gold mill refurbishment project. The transaction valued the future gold ounce delivery obligation at 79,954 gold ounces to be delivered in fixed monthly deliveries of 3,331 gold ounces over a 24-month period from January 2022 to December 2023.

During the third quarter of 2024, we completed our final fixed monthly delivery in August and have now fully completed all delivery obligations under the gold prepayment liability.

Working Capital

Working capital increased by $298.4 million to $434.3 million from December 31, 2023 to September 30, 2024, primarily due to an increase in cash and cash equivalents of $193.5 million, an increase in short-term investment of $40.0 million, a decrease in gold prepayment liability of $55.9 million, an increase in trade and other receivables of $43.6 million, a decrease in deferred revenue of $15.6 million, an increase in prepaid and other expenses of $4.1 million and a decrease in lease liabilities of $2.3 million. Partially offsetting these items were an increase in trades and other payable of $21.2 million, an increase in other financial liabilities and other liabilities of $17.2 million, a decrease in inventories of $10.7 million, an increase in taxes payable of $3.8 million and a decrease in other financial assets and taxes receivable of $3.7 million.

Cash Flows

The following table summarizes our cash flows for the three and nine months ended September 30, 2024 and September 30, 2023:

(in $ thousands) Three months ended Nine months ended
Sep. 30, 2024 Sep. 30, <br>2023 Sep. 30, 2024 Sep. 30, <br>2023
Operating cash flow before change in non-cash working capital 186,322 181,980 455,889 323,466
Change in non-cash working capital (40,144) (30,032) (31,553) (75,682)
Cash generated from operating activities 146,178 151,948 424,336 247,784
Cash used in investing activities (95,867) (68,247) (283,962) (189,244)
Cash (used in) generated from financing activities (92,277) (18,698) 51,485 (40,576)
Effect of movement in exchange rates on cash 1,472 480 1,620 1,588
(Decrease) increase in cash (40,494) 65,483 193,479 19,552

Cash Flow from Operating Activities

Cash generated from operating activities was $146.2 million during the third quarter of 2024, a decrease of $5.8 million compared to the same period in 2023. Operating cash flow before change in non-cash working capital was $186.3 million during the third quarter of 2024, reflecting an increase of $4.3 million compared to the third quarter of 2023. The increase in operating cash flows before change in working capital was primarily the result of higher realized gold and copper prices more than offsetting the impact of lower planned production of copper and precious metals and the impact of an increase of $17.3 million in cash taxes paid mostly in Peru, compared to the same period in 2023.

Year-to-date cash generated from operating activities was $424.3 million in 2024, an increase of $176.6 million compared to 2023. Operating cash flow before changes in non-cash working capital for the first nine months of 2024 was $455.9 million, an increase of $132.4 million compared to 2023. The increase in operating cash flow before changes in working capital was primarily the result of higher metal prices and gold sales volumes in part due to higher gold and copper grades at Lalor, as well as the incremental contribution margin from the Copper Mountain mine. This was partially offset by a significant increase in cash taxes paid of $85.1 million mainly at our Peru operations, compared to the same period in 2023.

Cash Flow from Investing and Financing Activities

During the third quarter of 2024, we spent $188.1 million in investing and financing activities, primarily driven by $98.3 million in capital expenditures, $48.1 million of our senior unsecured notes repurchased, net of discount, a $16.8 million repayment of our gold prepayment liability, $11.6 million in capitalized lease and equipment financing payments, the final $10.0 million deferred payment for the acquisition of a prior minority interest in Copper World, $2.9 million in other financing costs mainly related to our Credit Facilities and withholding taxes, $2.9 million in dividend payments and $2.4 million in community agreement payments. These cash outflows were partially offset by $5.1 million of interest income received.

Year-to-date, we spent $232.5 million in investing and financing activities, primarily driven by $250.2 million in capital expenditures, $100.0 million in repayments on our revolving credit facilities, $62.2 million repayment of our gold prepayment liability, $81.9 million of our senior unsecured notes repurchased, net of discount, $40.0 million in short-term investments, $37.4 million in interest paid on our long-term debt, $30.6 million in capitalized lease and equipment financing payments, $10.3 million in other financing costs mainly related to our Credit Facilities and withholding taxes, the final $10.0 million deferred payment for the acquisition of a prior minority interest in Copper World, $6.3 million in community agreement payments and $5.5 million of dividends paid. These cash outflows were partially offset by $386.2 million of proceeds from equity issuance, net of transaction and issuance costs, $12.8 million of interest income and grants received and $2.5 million net proceeds from exercise of stock options and warrants.

Capital Expenditures

The following summarizes accrued and cash additions to capital assets for the periods indicated:

Nine months ended Guidance
Sep. 30, <br>2023 Sep. 30, 2024 Sep. 30, <br>2023 Annual<br>2024^2^
(in millions)
Peru sustaining capital expenditures1 37.5 94.5 95.3 130.0
Manitoba sustaining capital expenditures 12.6 33.1 36.7 55.0
British Columbia sustaining capital expenditures3 11.1 93.9 11.1 105.0
Total sustaining capital expenditures 61.2 221.5 143.1 290.0
Arizona capitalized costs4 4.2 15.5 15.8 45.0
Peru growth capitalized expenditures 0.3 0.3 12.0 2.0
Manitoba growth capitalized expenditures - 4.7 13.5 10.0
British Columbia growth capitalized expenditures - 3.4 - 5.0
Other capitalized costs2 18.5 71.8 28.7
Capitalized exploration 14.9 5.5 15.8 8.0
Total other capitalized expenditures 37.9 101.2 85.8
Total accrued capital additions 99.1 322.7 228.9
Reconciliation to cash capital additions:
Right-of-use asset and equipment financing additions (17.5) (54.1) (22.2)
Grants received (13.7) 2.4 (13.7)
Community agreement additions (0.3) (1.8) (2.0)
Non-cash capitalized stripping (1.5) (18.2) (5.3)
Change in capital accruals and other 3.1 (0.8) 14.3
Acquisition of property, plant & equipment - cash 69.2 250.2 200.0
1 Peru sustaining capital expenditures include capitalized stripping costs.
2 Other capitalized costs primarily include right-of-use lease and equipment financing additions, which are excluded from guidance in 2024, in addition to non-cash deferred stripping.
3 Includes 100% of Copper Mountain mine production. Hudbay owns 75% of Copper mountain mine. As Copper Mountain was acquired on June 20, 2023, the production for the nine months ended September 30, 2023 represents the period from the acquisition date, June 20, 2023, through to the end of the third quarter of 2023.
4 With the receipt of the Aquifer Protection Permit on August 29, 2024, we expect to commence activities related to the preparation of feasibility studies for Copper World. As a result, 2024 growth capital spending in Arizona has increased by an additional 25 million, compared to the original 2024 guidance of 20 million.

All values are in US Dollars.

For the three and nine months ended September 30, 2024, total capital additions increased by $26.8 million and $93.8 million, respectively, compared to the same period in 2023, primarily due to new sustaining capital expenditures at the Copper Mountain mine and new leases and equipment financing transactions, partially offset by higher capitalized right of use assets and leases, and reduced sustaining and growth capital expenditures in Manitoba and Peru.

Sustaining capital expenditures in Manitoba for the three and nine months ended September 30, 2024 were $8.8 million and $33.1 million, respectively, representing a decrease of $3.8 million and $3.6 million, respectively, compared to the same period in 2023 due to lower capital development at Lalor. Sustaining capital expenditures in Peru for the three and nine months ended September 30, 2024 were $39.8 million and $94.5 million, respectively, representing an increase of $2.3 million and a decrease of $0.8 million, respectively, compared to the same period in 2023. Sustaining capital expenditures in British Columbia for the three and nine months ended September 30, 2024 were $40.7 million and $93.9 million, respectively, which included $18.5 million and $48.9 million of capitalized stripping related to our planned three-year accelerated stripping campaign to access higher grade ore.

Growth capital spending in Manitoba for the three and nine months ended September 30, 2024 was $1.4 million and $4.7 million, respectively, representing a increase of $1.4 million and a decrease of $8.8 million, respectively, compared to the same period in 2023. The decrease mainly relates to the completion of the Stall mill recovery improvement project in 2023, partially offset by the development of an exploration drift at 1901 in 2024. Growth capital expenditures in Peru for the three and nine months ended September 30, 2024 were $0.1 million and $0.3 million, respectively, representing a decrease of $0.2 million and $11.7 million, respectively. The decrease mainly relates to the completion of the copper recovery improvement project in 2023. Arizona's capital expenditures for the three and nine months ended September 30, 2024 were $5.7 million and $15.5 million, respectively, mainly related to ongoing carrying costs.

Other capitalized costs for the three and nine months ended September 30, 2024 were $25.6 million and $71.8 million, respectively, which are mostly made up of non-cash capitalized lease and equipment financing additions.

Capitalized exploration for the three and nine months ended September 30, 2024 were $1.4 million and $5.5 million, respectively.

We expect 2024 total capital expenditures to be in line with annual guidance.

Capital Commitments

As at September 30, 2024, we had outstanding capital commitments in Canada of approximately $11.4 million, of which $3.7 million can be terminated, approximately $57.3 million in Peru primarily related to sustaining capital commitments and exploration option agreements, all of which can be terminated, and approximately $35.2 million in Arizona, primarily related to our Copper World project, none of which can be terminated.

Contractual Obligations

The following table summarizes our significant contractual obligations as at September 30, 2024:

Less than<br>12 months 13 - 36<br>months 37 - 60<br>months More than<br>60 months
Payment Schedule (in millions)
Long-term debt obligations1 62.5 669.9 608.8 -
Equipment Financing and lease obligations 71.5 70.5 27.3 10.1
Purchase obligation - capital commitments 48.0 36.3 19.6 -
Purchase obligation - other commitments3 408.0 378.5 134.1 457.4
Pension and other employee future benefits obligations2 4.8 16.2 8.8 80.4
Community agreement obligations4, 5 22.0 11.5 8.1 48.9
Decommissioning and restoration obligations5 4.4 12.9 7.5 463.5
Total 621.2 1,195.8 814.2 1,060.3
1 Long-term debt obligations include scheduled interest payments, as well as principal repayments
2 Discounted.
3 Primarily made up of trades payables, accrued liabilities, long-term agreements with operational suppliers, obligations for power purchases, concentrate handling and fleet and port services.
4 Represents community agreement obligations and various finalized land user agreements, including Pampacancha.
5 Undiscounted before inflation.

All values are in US Dollars.

In addition to the contractual obligations included in the above payment schedule, we also have the following commitments which impact our financial position:

  • A profit-sharing plan with most Manitoba employees;

  • A profit-sharing plan with all Peru employees;

  • Wheaton precious metals stream agreement for the Constancia mine;

  • Government royalty payments related to the Constancia mines; and,

  • Participation agreements related to the Copper Mountain mine.

Outstanding Share Data

As of November 11, 2024, the final trading day prior to the date of this MD&A, there were 393,933,811 common shares of Hudbay issued and outstanding. In addition, there were 2,504,975 stock options and 80,872 common share purchase warrants outstanding.

TREND ANALYSIS AND QUARTERLY REVIEW

A detailed quarterly and annual summary of financial and operating performance can be found in the "Summary of Results" section at the end of this MD&A. The following table sets forth selected consolidated financial information for each of our eight most recently completed quarters:

(in $ millions, except per share amounts, production on a copper equivalent basis and average realized copper price) 2024 2023 2022
Q3 Q2 Q1 Q4^2^ Q3 Q2 Q1 Q4^2^
Production on a copper equivalent basis (tonnes) 60,895 47,164 62,120 77,951 71,335 37,530 38,614 45,454
Average realized copper price ($/lb) 4.24 4.56 3.91 3.77 3.77 3.89 3.98 3.61
Average realized gold price ($/oz) 2,582 2,222 1,941 2,062 1,738 1,810 1,881 1,615
Revenue 485.8 425.5 525.0 602.2 480.5 312.2 295.2 321.2
Gross profit 139.8 77.6 152.0 196.8 106.4 22.9 66.5 69.7
Earnings (loss) before tax 79.7 0.4 67.8 81.0 84.1 (30.7) 17.4 (14.3)
Net earnings (loss) 50.4 (20.4) 18.5 33.5 45.5 (14.9) 5.5 (17.4)
Net earnings (loss) earnings - attributable 49.8 (16.6) 22.4 30.7 45.1 (14.9) 5.5 (17.4)
Adjusted net earnings (loss)^1^- attributable 50.3 0.1 59.4 68.6 24.3 (18.3) 0.1 2.6
Earnings (loss) per share attributable:
Basic and diluted 0.13 (0.05) 0.06 0.09 0.13 (0.05) 0.02 (0.07)
Adjusted net earnings (loss)^1^ per share - attributable 0.13 0.00 0.17 0.20 0.07 (0.07) 0.00 0.01
Operating cash flow before change in non-cash working capital 186.3 122.0 147.5 246.5 182.0 55.9 85.6 109.1
Adjusted EBITDA^1^ 206.2 145.0 214.2 274.4 190.7 81.2 101.9 124.7
Adjusted EBITDA LTM^1^ 839.8 824.3 760.5 647.8 498.5 407.1 467.3 475.9
^1^ Adjusted net earnings (loss) - attributable to owners, adjusted net earnings (loss) per share - attributable to owners, adjusted EBITDA, and adjusted EBITDA last twelve months ("LTM") are non-IFRS financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A.
^2^ Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

On a quarterly basis, the Company's revenue is primarily impacted by metal prices, production mix and sales volumes of the key metals we produce. In addition to these factors, gross profit, net earnings (loss) attributable, earnings (loss) per share attributable, operating cash flow before change in non-cash working capital and adjusted EBITDA are also impacted by input costs. Net earnings (loss) and earnings (loss) per share are further impacted by net finance expense and re-evaluation adjustments of our closed site environmental provision.

The Company's results have also been impacted by the acquisition of Copper Mountain in June 2023.

During the third quarter of 2024, profitability and cash flows grew compared to the second quarter of 2024. This strength is related to higher gold, copper and zinc production compared to the second quarter of 2024, along with returning strength in commodity prices including record gold prices. These impacts offset lower planned mined grades observed in Peru in the third quarter of 2024 and the higher cash mining taxes paid in Peru resulting from higher profitability over the past several quarters. Strong operating cost control has continued into the third quarter resulting from a number of operational initiatives and high levels of mill throughput being experienced throughout the business.

During the second quarter of 2024, realized copper and gold prices continue to climb which overcame the decline in sales volumes of concentrate compared to the first quarter of 2024. Expected lower mined grades observed for the same metals in Peru and Manitoba were the primary factor for the decline in production since the first quarter of the year. Cost control remained favourable as we continued to track within cost guidance given the expected cadence in the year's production profile. Higher mining taxes continued as we experienced higher profitability over the past several quarters. Lastly, volatile inter-period copper and gold prices led to relatively high mark-to-market adjustments for our strategic non-QP hedging program and high share prices for our common shares led to higher share-based compensation expenses. This led to a total of $19.5 million in mark-to-market adjustments to be added back in our adjusted net earnings - attributable to owners measure

The first quarter of 2024 and the fourth quarter of 2023 reflected the continuation of strong copper, gold and silver production that commenced in the third quarter of 2023. The increase in copper, gold and silver prices in the first quarter of 2024 also contributed to strong revenue and profitability in the quarter.

Third quarter of 2023 results reflected significantly higher copper and gold production and sales volumes from the high grade zones of the Pampacancha deposit and higher gold and copper grade zones at Lalor resulting in a significant increase in our revenues, gross profits and earnings.

The second quarter of 2023 benefited from the drawdown of higher-than-normal unsold copper concentrate inventory levels in Peru that had built up due to supply chain disruptions during a short period of social and political unrest in the first quarter of 2023.

Gold prices during the first quarter of 2023 averaged levels not seen since 2020, which positively impacted gross profit during the quarter. Social and political unrest in Peru resulted in road blockades causing logistics and supply chain disruptions until mid-February 2023 and led to a buildup of copper concentrate inventory above normal operating levels, affecting overall revenues and net earnings attributable in the first quarter.

Revenues for the fourth quarter of 2022 were negatively impacted by lower production due to planned maintenance programs at Lalor and Constancia, short-term changes in the mine plan in Peru and a build up of product inventory in Peru due to the aforementioned social unrest. The revenue impact of lower throughput was partially offset by higher commodity prices. Inflationary pressures on fuel, consumables and energy costs negatively impacting our production costs and margins.

NON-IFRS FINANCIAL PERFORMANCE MEASURES

Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, realized prices, net debt, net debt to adjusted EBITDA, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit cost and ratios based on these measures are non-IFRS performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of gross profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently.

Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the Company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the Company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the Company believes these measures are useful to investors in assessing the Company's underlying performance. We provide adjusted EBITDA to help users analyze our results and to provide additional information about our ongoing cash generating potential in order to assess our capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the Company to assess our financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the Company to assess our financial leverage and debt capacity. Realized price is shown to understand the average realized price of metals sold to third parties in each reporting period. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because we believe they help investors and management assess the performance of our operations, including the margin generated by the operations and the Company. Cash cost and sustaining cash cost per ounce of gold produced are shown because we believe they help investors and management assess the performance of our Manitoba operations. Combined unit cost is shown because we believe it helps investors and management assess our cost structure and margins that are not impacted by variability in by-product commodity prices.

Adjusted Net Earnings - Attributable

Adjusted net earnings attributable to owners represents net earnings (loss) excluding certain impacts such as mark-to-market adjustments, foreign exchange (gains) loss, revaluation adjustment - environmental provisions for closed sites, variable consideration adjustment related to stream agreements, impairment charges and reversal of impairment charges on assets, (gain) loss on disposal of assets, other items that are not indicative of the underlying operating performance of our core business; and tax effect and non-controlling interest of the previously discussed items. These measures are not necessarily indicative of net earnings (loss) as determined under IFRS. The following table provides a reconciliation of net earnings and non-controlling interest per the condensed consolidated interim statements of income, to adjusted net earnings attributable to owners of the Company for the three and nine months ended September 30, 2024 and 2023.

Three months ended Nine months ended
(in $ millions) Sep. 30, 2024 Sep. 30, <br>2023 Sep. 30, 2024 Sep. 30, <br>2023
Net earnings for the period 50.4 45.5 48.5 36.0
Tax expense 29.3 38.7 99.4 34.8
Earnings before tax 79.7 84.2 147.9 70.8
Adjusting items:
Mark-to-market adjustments^1^ 5.2 1.3 37.4 9.4
Foreign exchange (gain) loss (3.3) (0.6) 3.6 1.1
Re-evaluation adjustment - environmental provision^2^ 2.0 (32.4) (6.0) (45.4)
Variable consideration adjustment - stream revenue and accretion - - 4.0 (5.0)
Inventory adjustments 1.6 - 1.6 0.9
Acquisition related costs - 0.1 - 6.9
Restructuring charges - 2.3 1.2 2.3
Reduction of obligation to renounce flow-through expenditures (2.0) - (3.0) -
Write-down/loss on disposal of PP&E 2.2 - 13.3 0.4
Adjusted earnings before income taxes 85.4 54.9 200.0 41.4
Tax expense (29.3) (38.7) (99.4) (34.8)
Tax impact of adjusting items (5.2) 8.2 7.4 (0.5)
Adjusted net earnings 50.9 24.4 108.0 6.1
Adjusted net earnings attributable to non-controlling interest:
Net (earnings) loss for the period (0.6) (0.4) 7.0 (0.4)
Adjusting items, including tax impact - 0.2 (3.9) 0.2
Adjusted net earnings - attributable to owners 50.3 24.2 111.1 5.9
Adjusted net earnings ($/share) - attributable to owners 0.13 0.07 0.30 0.02
Basic weighted average number of common shares outstanding (millions) 393.6 346.7 371.0 294.0
^1^ Includes changes in fair value of the gold prepayment liability, Canadian junior mining investments, other financial assets and liabilities at fair value through net earnings and share-based compensation (recoveries) expenses. Also includes gains and losses on disposition of investments.
^2^ Changes from movements to environmental reclamation provisions are primarily related to the Flin Flon operations, which were fully depreciated as of June 30, 2022, as well as other Manitoba non-operating sites.

After adjusting reported net earnings for those items not considered representative of the Company's core business or indicative of future operations, the Company had adjusted net earnings - attributable in the third quarter of 2024 of $50.3 million or 0.13 earnings per share.

Adjusted EBITDA

Adjusted EBITDA is earnings before net finance expense/income, tax expense/recoveries, depreciation and amortization of property, plant and equipment and deferred revenue, as well as certain other adjustments. We calculate adjusted EBITDA by excluding certain adjustments included within our adjusted net earnings attributable measure which we believe reflects the underlying performance of our core operating activities. The measure also removes the impact of non-cash items and financing costs that are not associated with measuring the underlying performance of our operations. However, our adjusted EBITDA is not the measure defined as EBITDA under our senior notes or revolving credit facilities and may not be comparable with performance measures with the same name reported by other companies. Adjusted EBITDA should not be considered as a substitute for earnings or as a better measure of liquidity than operating cash flow, which are calculated in accordance with IFRS. We provide adjusted EBITDA to help users analyze our results and to provide additional information about our ongoing cash generating potential in order to assess our capacity to service and repay debt, carry out investments and cover working capital needs.

The following table presents the reconciliation of earnings per the condensed consolidated interim statements of income, to adjusted EBITDA for the three and nine months ended September 30, 2024 and 2023:

Three months ended Nine months ended
(in $ millions) Sep. 30, 2024 Sep. 30, <br>2023 Sep. 30, 2024 Sep. 30, <br>2023
Net earnings for the period 50.4 45.5 48.5 36.0
Add back:
Tax expense 29.3 38.7 99.4 34.8
Net finance expense 26.0 30.9 114.3 96.4
Other expense 7.9 8.9 35.3 27.7
Depreciation and amortization 97.5 113.8 304.4 269.8
Amortization of deferred revenue and variable consideration adjustment (9.5) (16.8) (44.3) (50.8)
Adjusting items (pre-tax):
Re-evaluation adjustment - environmental provision 2.0 (32.4) (6.0) (45.4)
Inventory adjustments 1.6 - 1.6 0.9
Option agreement proceeds (Marubeni) - - (0.4) -
Realized loss on non-QP hedges (2.1) - (4.7) -
Share-based compensation expense ^1^ 3.1 2.1 17.1 4.0
Adjusted EBITDA 206.2 190.7 565.2 373.4
^1^ Share-based compensation expense reflected in cost of sales and selling and administrative expenses.

Net Debt

The following table presents our calculation of net debt as at September 30, 2024 and December 31, 2023:

(in $ thousands) Sep. 30, <br>2024 Dec. 31, <br>2023
Total long-term debt 1,108,900 1,287,536
Cash and cash equivalents (443,273 ) (249,794 )
Short-term investments (40,000 ) -
Net debt 625,627 1,037,742

Net Debt to Adjusted EBITDA Ratio

The following table presents our calculation of net debt to adjusted EBITDA, both metrics have been reconciled above to the most comparable IFRS measure, as at September 30, 2024 and December 31, 2023:

(in $ millions, except net debt to adjusted EBITDA ratio) Sep. 30, <br>2024 Dec. 31, <br>2023
Net debt 625.6 1,037.7
Adjusted EBITDA for the last twelve months 839.8 647.8
Net debt to adjusted EBITDA 0.7 1.6

The following table presents the reconciliation of Net earnings per the condensed consolidated interim statements of income, to adjusted EBITDA for the last twelve months ended September 30, 2024 and December 31, 2023:

12 months ended
(in $ millions) Sep. 30, <br>2024 Dec. 31, <br>2023
Net earnings for the period 82.0 69.5
Add back:
Tax expense 146.9 82.3
Net finance expense 163.2 145.3
Other expense 46.0 38.3
Depreciation and amortization 426.3 391.7
Amortization of deferred revenue and variable consideration adjustment (70.7 ) (77.3 )
Adjusting items (pre-tax):
Re-evaluation adjustment - environmental provision 28.0 (11.4 )
Inventory adjustments 3.0 2.3
Option agreement proceeds (Marubeni) (0.4 ) -
Realized loss on non-QP hedges (4.7 ) -
Share-based compensation expense ^1^ 20.2 7.1
Adjusted EBITDA for the last twelve months 839.8 647.8
^1^ Share-based compensation expense reflected in cost of sales and selling and administrative expenses.

The following table presents our calculation of the last twelve months adjusted EBITDA:

Three months ended LTM^1^
Trailing Adjusted EBITDA<br>(in $ millions) Sep. 30, 2024 Jun. 30, <br>2024 Mar. 31, <br>2024 Dec. 31, <br>2023
Net earnings (loss) for the period 50.4 (20.4 ) 18.5 33.5 82.0
Add back:
Tax expense 29.3 20.8 49.3 47.5 146.9
Net finance expense 26.0 44.3 44.0 48.9 163.2
Other expenses 7.9 11.2 16.3 10.6 46.0
Depreciation and amortization 97.5 97.6 109.3 121.9 426.3
Amortization of deferred revenue and variable consideration adjustment (9.5 ) (11.5 ) (23.2 ) (26.5 ) (70.7 )
Adjusting items (pre-tax):
Re-evaluation adjustment - environmental provision 2.0 (2.7 ) (5.3 ) 34.0 28.0
Inventory adjustments 1.6 - - 1.4 3.0
Realized loss on non-QP hedges (2.1 ) (2.6 ) - - (4.7 )
Option agreement proceeds - - (0.4 ) - (0.4 )
Share-based compensation expenses^2^ 3.1 8.3 5.7 3.1 20.2
Adjusted EBITDA 206.2 145.0 214.2 274.4 839.8
^1^ LTM (last twelve months) as of September 30, 2024.
^2^ Share-based compensation expense reflected in cost of sales and administrative expenses.

Cash Cost, Sustaining and All-in Sustaining Cash Cost (Copper Basis)

Cash cost per pound of copper produced ("cash cost") is a non-IFRS measure that management uses as a key performance indicator to assess the performance of our operations. Our calculation designates copper as our primary metal of production as it has been the largest component of revenues. The calculation is presented in four manners:

  • Cash cost, before by-product credits - This measure is gross of by-product revenues and is a function of the efforts and costs incurred to mine and process all ore mined. However, the measure divides this aggregate cost over only pounds of copper produced, our primary metal of production. This measure is generally less volatile from period to period, as it is not affected by changes in the price received for by-product metals. It is, however, affected by the relative mix of copper concentrate and zinc concentrate production, where an increase in production of zinc concentrate will tend to result in an increase in cash cost under this measure.

  • Cash cost, net of by-product credits - In order to calculate the net cost to produce and sell copper, the net of by-product credits measure subtracts the revenues realized from the sale of the metals other than copper. The by-product revenues from zinc, gold, and silver are significant and are integral to the economics of our operations. The economics that support our decision to produce and sell copper would be different if we did not receive revenues from the other significant metals being extracted and processed. This measure provides management and investors with an indication of the minimum copper price consistent with positive operating margins, assuming realized by-product metal prices are consistent with those prevailing during the reporting period. It also serves as an important operating statistic that management and investors utilize to measure our operating performance versus that of our competitors. However, it is important to understand that if by-product metal prices decline alongside copper prices, the cash cost net of by-product credits would increase, requiring a higher copper price than that reported to maintain positive cash flows and operating margins.

  • Sustaining cash cost, net of by-product credits - This measure is an extension of cash cost that includes cash sustaining capital expenditures, including payments on capitalized leases, capitalized sustaining exploration, net smelter returns royalties, payments on certain long-term community agreements, as well as accretion and amortization for expected decommissioning activities for producing assets. It does not include corporate selling and administrative expenses. It provides a more fulsome measurement of the cost of sustaining production than cash cost, which is focused on operating costs only.

- All-in sustaining cash cost, net of by-product credits - This measure is an extension of sustaining cash cost that includes corporate G&A, regional costs, accretion and amortization for community agreements relating to current operations, and accretion for expected decommissioning activities for non-producing sites. Due to the inclusion of corporate selling and administrative expenses, all-in sustaining cash cost is presented on a consolidated basis only.

The tables below present a detailed build-up of cash cost and sustaining cash cost, net of by-product credits, by business unit in addition to consolidated all-in sustaining cash cost, net of by-product credits, and reconciliations between cash cost, net of by-product credits, to the most comparable IFRS measures of cost of sales for the three and nine months ended September 30, 2024 and 2023. Cash cost, net of by-product credits may not calculate exactly based on amounts presented in the tables below due to rounding.

Consolidated Three months ended Nine months ended
Net pounds of copper produced^1^
(in thousands) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Peru 46,782 64,112 143,329 148,327
Manitoba 7,491 7,893 20,258 18,561
British Columbia 14,850 20,510 45,148 23,240
Net pounds of copper produced 69,123 92,515 208,735 190,128
^1^ Contained copper in concentrate.
Consolidated Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Cash cost, before by-product credits 259,457 3.75 288,410 3.12 798,751 3.83 685,428 3.61
By-product credits (246,724) (3.57) (187,023) (2.02) (702,083) (3.37) (469,551) (2.47)
Cash cost, net of by-product credits 12,733 0.18 101,387 1.10 96,668 0.46 215,877 1.14
Consolidated Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Mining 90,679 1.31 104,547 1.13 285,861 1.37 242,420 1.28
Milling 85,145 1.23 88,021 0.95 256,684 1.23 218,929 1.15
G&A 38,016 0.55 36,107 0.39 111,596 0.53 83,637 0.44
Onsite costs 213,840 3.09 228,675 2.47 654,141 3.13 544,986 2.87
Treatment & refining 21,202 0.31 32,882 0.36 71,428 0.35 78,047 0.41
Freight & other 24,415 0.35 26,853 0.29 73,182 0.35 62,395 0.33
Cash cost, before by-product credits 259,457 3.75 288,410 3.12 798,751 3.83 685,428 3.61
Consolidated Nine months ended
--- --- --- --- --- --- --- ---
Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $/lb ^1^ $000s $/lb ^1^ $000s $/lb^1^ $000s $/lb^1^
By-product credits2:
Zinc 0.35 17,099 0.18 53,831 0.26 56,369 0.30
Gold3 2.73 129,954 1.41 534,968 2.57 309,459 1.63
Silver3 0.27 16,724 0.18 59,474 0.28 46,003 0.24
Molybdenum & other 0.22 23,246 0.25 53,810 0.26 57,720 0.30
Total by-product credits 3.57 187,023 2.02 702,083 3.37 469,551 2.47
Reconciliation to IFRS:
Cash cost, net of by-product credits 101,387 96,668 215,877
By-product credits 187,023 702,083 469,551
Treatment and refining charges (32,882) (71,428) (78,047)
Inventory adjustments - 1,598 906
Share-based compensation expense 149 1,285 288
Past service pension costs - 2,786 -
Change in product inventory 3,374 21,364 9,079
Royalties 1,253 8,188 4,537
Depreciation and amortization4 113,753 304,371 269,845
Cost of sales5 374,057 1,066,915 892,036
1 Per pound of copper produced.
2 By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments. For more information, please see the realized price reconciliation table on page 33 of this MD&A for these figures.
3 Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. Variable consideration adjustments are cumulative adjustments to gold and silver stream deferred revenue primarily associated with the net change in mineral reserves and resources or amendments to the mine plan that would change the total expected deliverable ounces under the precious metal streaming arrangement. For the nine months ended September 30, 2024 the variable consideration adjustments amounted loss of 3,849 (nine months ended September 30, 2023 - income of 4,885).
4 Depreciation is based on concentrate sold.
5 As per consolidated interim financial statements.

All values are in US Dollars.

Peru Three months ended Nine months ended
(in thousands) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Net pounds of copper produced^1^ 46,782 64,112 143,329 148,327
^1^Contained copper in concentrate.
Peru Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Mining 37,647 0.81 33,875 0.53 98,173 0.69 92,315 0.62
Milling 48,535 1.04 46,996 0.73 143,494 1.00 147,863 1.00
G&A 19,830 0.42 20,912 0.33 62,271 0.43 52,245 0.35
Onsite costs 106,012 2.27 101,783 1.59 303,938 2.12 292,423 1.97
Treatment & refining 11,366 0.24 19,143 0.30 37,422 0.26 46,843 0.32
Freight & other 14,130 0.30 17,040 0.26 43,303 0.30 41,891 0.28
Cash cost, before by-product credits 131,508 2.81 137,966 2.15 384,663 2.68 381,157 2.57
By-product credits (47,245) (1.01) (84,793) (1.32) (201,825) (1.40) (182,885) (1.23)
Cash cost, net of by-product credits 84,263 1.80 53,173 0.83 182,838 1.28 198,272 1.34
Peru Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $000s $/lb ^1^ $000s $/lb ^1^ $000s $/lb ^1^ $000s $/lb ^1^
By-product credits^2^:
Gold^3^ 22,945 0.49 51,459 0.80 114,028 0.79 92,398 0.62
Silver^3^ 9,214 0.20 10,088 0.16 34,468 0.24 33,006 0.22
Molybdenum 15,086 0.32 23,246 0.36 53,329 0.37 57,481 0.39
Total by-product credits 47,245 1.01 84,793 1.32 201,825 1.40 182,885 1.23
Reconciliation to IFRS:
Cash cost, net of by-product credits 84,263 53,173 182,838 198,272
By-product credits 47,245 84,793 201,825 182,885
Treatment and refining charges (11,366) (19,143) (37,422) (46,843)
Inventory adjustments 206 - 206 -
Share-based compensation expenses 98 45 413 60
Change in product inventory 1,133 4,137 16,311 20,080
Royalties 2,117 1,015 5,164 4,159
Depreciation and amortization^4^ 57,242 80,625 187,132 189,925
Cost of sales^5^ 180,938 204,645 556,467 548,538
^1^Per pound of copper produced.
^2^By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments. For more information, please see the realized price reconciliation table on page 33 of this MD&A.
^3^Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements.
^4^Depreciation is based on concentrate sold.
^5^ As per consolidated interim financial statements.
British Columbia Three months ended Nine months ended
--- --- --- --- ---
(in thousands) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Net pounds of copper produced^1^ 14,850 20,510 45,148 23,240
^1^Contained copper in concentrate.
British Columbia Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Mining 12,918 0.87 29,251 1.43 60,934 1.35 29,251 1.26
Milling 19,707 1.33 24,102 1.17 64,589 1.43 24,102 1.04
G&A 5,788 0.39 5,050 0.25 15,132 0.34 5,050 0.22
Onsite costs 38,413 2.59 58,403 2.85 140,655 3.12 58,403 2.52
Treatment & refining 3,307 0.22 4,905 0.24 10,982 0.24 4,905 0.21
Freight & other 3,002 0.20 3,693 0.18 10,757 0.24 3,693 0.16
Cash cost, before by-product credits 44,722 3.01 67,001 3.27 162,394 3.60 67,001 2.89
By-product credits (17,891) (1.20) (12,234) (0.60) (41,957) (0.93) (12,234) (0.53)
Cash cost, net of by-product credits 26,831 1.81 54,767 2.67 120,437 2.67 54,767 2.36
British Columbia Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $000s $/lb ^1^ $000s $/lb ^1^ $000s $/lb ^1^ $000s $/lb ^1^
By-product credits^2^:
Gold 16,259 1.09 10,120 0.50 36,027 0.80 10,120 0.44
Silver 1,632 0.11 2,114 0.10 5,930 0.13 2,114 0.09
Total by-product credits 17,891 1.20 12,234 0.60 41,957 0.93 12,234 0.53
Reconciliation to IFRS:
Cash cost, net of by-product credits 26,831 54,767 120,437 54,767
By-product credits 17,891 12,234 41,957 12,234
Treatment and refining charges (3,307) (4,905) (10,982) (4,905)
Change in product inventory (550) 3 6,775 3
Royalties 1,629 237 3,024 237
Depreciation and amortization^3^ 12,548 6,255 38,239 6,255
Cost of sales^4^ 55,042 68,591 199,450 68,591
^1^Per pound of copper produced.
^2^By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments. For more information, please see the realized price reconciliation table on page 33 of this MD&A.
^3^Depreciation is based on concentrate sold.
^4^ As per consolidated interim financial statements.
Consolidated Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
All-in sustaining cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Cash cost, net of by-product credits 12,733 0.18 101,387 1.10 96,668 0.46 215,877 1.14
Cash sustaining capital expenditures 101,610 1.47 72,193 0.78 256,897 1.23 168,315 0.88
Capitalized exploration - - - - 2,400 0.01 - -
Royalties 3,746 0.06 1,253 0.01 8,188 0.04 4,537 0.02
Sustaining cash cost, net of by-product credits 118,089 1.71 174,833 1.89 364,153 1.74 388,729 2.04
Corporate selling and administrative expenses & regional costs 12,843 0.18 10,971 0.12 50,708 0.24 30,789 0.16
Accretion and amortization of decommissioning and community agreements^1^ 3,935 0.06 3,309 0.03 14,485 0.07 7,059 0.04
All-in sustaining cash cost, net of by-product credits 134,867 1.95 189,113 2.04 429,347 2.06 426,577 2.24
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions 76,708 77,454 198,151 158,582
Capitalized stripping net additions 49,304 21,762 124,661 70,386
Total accrued capital additions 126,012 99,216 322,812 228,968
Less other non-sustaining capital costs^2^ 36,599 37,968 101,246 85,824
Total sustaining capital costs 89,413 61,248 221,566 143,144
Capitalized lease & equipment financing cash payments - operating sites 10,234 7,199 28,083 16,275
Community agreement cash payments 312 1,953 1,790 4,432
Accretion and amortization of decommissioning and restoration obligations ^3^ 1,651 1,793 5,458 4,464
Cash sustaining capital expenditures 101,610 72,193 256,897 168,315
^1^ Includes accretion of decommissioning liability relating to non-producing sites, and accretion and amortization of community agreements capitalized to Other assets.
^2^Other non-sustaining capital costs include Arizona capitalized costs, capitalized interest, capitalized exploration, right-of-use lease asset additions, equipment financing asset additions and growth capital expenditures.
^3^Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.
Peru Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Sustaining cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Cash cost, net of by-product credits 84,263 1.80 53,173 0.83 182,838 1.28 198,272 1.34
Cash sustaining capital expenditures 43,710 0.93 42,607 0.66 107,291 0.75 109,596 0.74
Capitalized exploration^1^ - - - - 2,400 0.01 - -
Royalties 2,117 0.05 1,015 0.02 5,164 0.04 4,159 0.03
Sustaining cash cost per pound of copper produced 130,090 2.78 96,795 1.51 297,693 2.08 312,027 2.10
^1^ Only includes exploration costs incurred for locations near to existing mine operations.
British Columbia Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Sustaining cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb $000s $/lb
Cash cost, net of by-product credits 26,831 1.81 54,767 2.67 120,437 2.67 54,767 2.36
Cash sustaining capital expenditures 46,612 3.14 14,487 0.71 109,083 2.41 14,487 0.62
Capitalized exploration - - - - 0 0.00 - -
Royalties 1,629 0.11 237 0.01 3,024 0.07 237 0.01
Sustaining cash cost per pound of copper produced 75,072 5.06 69,491 3.39 232,544 5.15 69,491 2.99

Gold Cash Cost and Gold Sustaining Cash Cost

Cash cost per ounce of gold produced ("gold cash cost") is a non-IFRS measure that management uses as a key performance indicator to assess the performance of our Manitoba operations. This alternative cash cost calculation designates gold as the primary metal of production as it represents a substantial component of revenues for our Manitoba business unit and should therefore be less volatile over time than Manitoba cash cost per pound of copper. The calculation is presented in three manners:

  • Gold cash cost, before by-product credits - This measure is gross of by-product revenues and is a function of the efforts and costs incurred to mine and process all ore mined. However, the measure divides this aggregate cost over only ounces of gold produced, the assumed primary metal of production. This measure is generally less volatile from period to period, as it is not affected by changes in the price received for by-product metals.

  • Gold cash cost, net of by-product credits - In order to calculate the net cost to produce and sell gold, the net of by-product credits measure subtracts the revenues realized from the sale of the metals other than gold. The by-product revenues from copper, zinc, and silver are significant and are integral to the economics of our Manitoba operation. The economics that support our decision to produce and sell gold would be different if we did not receive revenues from the other significant metals being extracted and processed. This measure provides management and investors with an indication of the minimum gold price consistent with positive operating margins, assuming realized by-product metal prices are consistent with those prevailing during the reporting period. It also serves as an important operating statistic that management and investors utilize to measure our operating performance at our Manitoba operation versus that of our competitors. However, it is important to understand that if by-product metal prices decline alongside gold prices, the gold cash cost net of by-product credits would increase, requiring a higher gold price than that reported to maintain positive cash flows and operating margins.

  • Gold sustaining cash cost, net of by-product credits - This measure is an extension of gold cash cost that includes cash sustaining capital expenditures, capitalized exploration, net smelter returns royalties, as well as accretion and amortization for expected decommissioning activities for producing assets. It does not include corporate selling and administrative expenses. It provides a more fulsome measurement of the cost of sustaining production than gold cash cost, which is focused on operating costs only.

The tables below present a detailed build-up of gold cash cost and gold sustaining cash cost, net of by-product credits, for the Manitoba business unit, and reconciliations between gold cash cost, net of by-product credits, to the most comparable IFRS measures of cost of sales for the three and nine months ended September 30, 2024 and 2023. Gold cash cost, net of by-product credits, may not calculate exactly based on amounts presented in the tables below due to rounding.

Manitoba Three months ended Nine months ended
(in thousands) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Net ounces of gold produced^1^ 62,468 56,213 162,787 127,500
^1^ Contained gold in concentrate and doré.
Manitoba Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Cash cost per ounce of gold produced $000s $/oz^1^ $000s $/oz^1^ $000s $/oz^1^ $000s $/oz^1^
Mining 40,114 642 41,421 737 126,754 779 120,854 948
Milling 16,903 271 16,923 301 48,601 298 46,964 368
G&A 12,398 198 10,145 180 34,193 210 26,342 207
Onsite costs 69,415 1,111 68,489 1,218 209,548 1,287 194,160 1,523
Treatment & refining 6,529 104 8,834 157 23,024 141 26,299 206
Freight & other 7,283 117 6,120 109 19,122 118 16,811 132
Cash cost, before by-product credits 83,227 1,332 83,443 1,484 251,694 1,546 237,270 1,861
By-product credits (59,987) (960) (45,779) (814) (153,107) (940) (127,128) (997)
Gold cash cost, net of by-product credits 23,240 372 37,664 670 98,587 606 110,142 864
Manitoba Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Supplementary cash cost information Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
$000s $/oz ^1^ $000s $/oz^1^ $000s $/oz ^1^ $000s $/oz ^1^
By-product credits^2^:
Copper 28,152 451 24,158 430 79,719 490 59,637 468
Zinc 24,326 389 17,099 304 53,831 330 56,369 442
Silver 7,501 120 4,522 80 19,076 117 10,883 85
Other 8 - - - 481 3 239 2
Total by-product credits 59,987 960 45,779 814 153,107 940 127,128 997
Reconciliation to IFRS:
Cash cost, net of by-product credits 23,240 37,664 98,587 110,142
By-product credits 59,987 45,779 153,107 127,128
Treatment and refining charges (6,529) (8,834) (23,024) (26,299)
Past service pension costs 2,786 - 2,786 -
Share-based compensation expenses 224 104 872 228
Inventory adjustments 1,392 - 1,392 906
Change in product inventory 1,245 (766) (1,722) (11,004)
Royalties - 1 - 141
Depreciation and amortization^3^ 27,662 26,873 79,000 73,665
Cost of sales^4^ 110,007 100,821 310,998 274,907
^1^Per ounce of gold produced.
^2^By-product credits are computed as revenue per financial statements, amortization of deferred revenue and pricing and volume adjustments. For more information, please see the realized price reconciliation table on page 33 of this MD&A.
^3^Depreciation is based on concentrate sold.
^4^As per consolidated interim financial statements.
Manitoba Three months ended Nine months ended
--- --- --- --- --- --- --- --- ---
Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Sustaining cash cost per ounce of gold produced $000s $/oz $000s $/oz $000s $/oz $000s $/oz
Gold cash cost, net of by-product credits 23,240 372 37,664 670 98,587 606 110,142 864
Cash sustaining capital expenditures 11,289 181 15,100 269 40,524 249 44,232 347
Royalties - - 1 - - - 141 1
Sustaining cash cost per ounce of gold produced 34,529 553 52,765 939 139,111 855 154,515 1,212

Combined Unit Cost

Combined unit cost ("unit cost") and zinc plant unit cost is a non-IFRS measure that management uses as a key performance indicator to assess the performance of our mining and milling operations. Combined unit cost is calculated by dividing the cost of sales by mill throughput. This measure is utilized by management and investors to assess our cost structure and margins and compare it to similar information provided by other companies in our industry. Unlike cash cost, this measure is not impacted by variability in by-product commodity prices since there are no by-product deductions; costs associated with profit-sharing and similar costs are excluded because of their correlation to external metal prices. In addition, the unit costs are reported in the functional currency of the operation which minimizes the impact of foreign currency fluctuations. In all, the unit cost measures provide an alternative perspective on operating cost performance with minimal impact from external market prices.

The tables below present a detailed combined unit cost for the Peru and Manitoba business units, and reconciliations between these measures to the most comparable IFRS measures of cost of sales for the three and nine months ended September 30, 2024 and 2023.

Peru Three months ended Nine months ended
(in thousands except unit cost per tonne) Sep. 30, 2024 Sep. 30, <br>2023 Sep. 30, 2024 Sep. 30, <br>2023
Combined unit cost per tonne processed
Mining 37,647 33,875 98,173 92,315
Milling 48,535 46,996 143,494 147,863
G&A^1^ 19,830 20,912 62,271 52,245
Less: Other G&A^2^ (1,993) (5,440) (13,793) (6,521)
Unit cost 104,019 96,343 290,145 285,902
Tonnes ore milled 8,137 7,895 23,934 22,782
Combined unit cost per tonne 12.78 12.20 12.12 12.55
Reconciliation to IFRS:
Unit cost 104,019 96,343 290,145 285,902
Freight & other 14,130 17,040 43,303 41,891
Other G&A 1,993 5,440 13,793 6,521
Share-based compensation expenses 98 45 413 60
Inventory adjustments 206 - 206 -
Change in product inventory 1,133 4,137 16,311 20,080
Royalties 2,117 1,015 5,164 4,159
Depreciation and amortization 57,242 80,625 187,132 189,925
Cost of sales^3^ 180,938 204,645 556,467 548,538
^1^ G&A as per cash cost reconciliation above.
^2^ Other G&A primarily includes profit sharing costs.
^3^ As per consolidated interim financial statements.
Manitoba Three months ended Nine months ended
--- --- --- --- ---
(in thousands except tonnes ore milled and unit cost per tonne) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Combined unit cost per tonne processed
Mining 40,114 41,421 126,754 120,854
Milling 16,903 16,923 48,601 46,964
G&A^1^ 12,398 10,145 34,193 26,342
Less: Other G&A related to profit sharing costs (5,385) (3,308) (12,945) (5,128)
Unit cost 64,030 65,181 196,603 189,032
USD/CAD implicit exchange rate 1.36 1.34 1.37 1.34
Unit cost - C$ 87,391 87,363 268,475 254,216
Tonnes ore milled 413,919 402,443 1,201,112 1,168,642
Combined unit cost per tonne - C$ 211 217 224 218
Reconciliation to IFRS:
Unit cost 64,030 65,181 196,603 189,032
Freight & other 7,283 6,120 19,122 16,811
Other G&A related to profit sharing 5,385 3,308 12,945 5,128
Share-based compensation expenses 224 104 872 228
Inventory adjustments 1,392 - 1,392 906
Past service pension costs 2,786 - 2,786 -
Change in product inventory 1,245 (766) (1,722) (11,004)
Royalties - 1 - 141
Depreciation and amortization 27,662 26,873 79,000 73,665
Cost of sales^2^ 110,007 100,821 310,998 274,907
^1^ G&A as per cash cost reconciliation above.
^2^ As per consolidated interim financial statements.
British Columbia Three months ended Nine months ended
--- --- --- --- ---
(in thousands except unit cost per tonne) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023
Combined unit cost per tonne processed
Mining 12,918 29,251 60,934 29,251
Milling 19,707 24,102 64,589 24,102
G&A^1^ 5,788 5,050 15,132 5,050
Unit cost 38,413 58,403 140,655 58,403
USD/CAD implicit exchange rate 1.35 1.35 1.35 1.35
Unit cost - C$ 52,388 78,566 191,198 78,566
Tonnes ore milled 3,363 3,158 9,776 3,600
Combined unit cost per tonne - C$ 15.58 24.88 19.56 21.82
Reconciliation to IFRS:
Unit cost 38,413 58,403 140,655 58,403
Freight & other 3,002 3,693 10,757 3,693
Change in product inventory (550) 3 6,775 3
Royalties 1,629 237 3,024 237
Depreciation and amortization 12,548 6,255 38,239 6,255
Cost of sales^2^ 55,042 68,591 199,450 68,591
^1^ G&A as per cash cost reconciliation above.
^2^ As per consolidated interim financial statements.

ACCOUNTING CHANGES AND CRITICAL ESTIMATES

New standards and interpretations adopted

For information on new standards and interpretations adopted, refer to note 3 of our September 30, 2024 consolidated interim financial statements.

Estimates and judgements

The preparation of the consolidated interim financial statements in accordance with IFRS requires us to make judgements, estimates and assumptions that affect the application of accounting policies, reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated interim financial statements, and reported amounts of revenue and expenses during the reporting period. Actual results may differ from these estimates.

We review these estimates and underlying assumptions on an ongoing basis based on our experience and other factors, including expectations of future events that we believe to be reasonable under the circumstances. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Certain accounting estimates and judgements have been identified as being "critical" to the presentation of our financial condition and results of operations because they require us to make subjective and/or complex judgments about matters that are inherently uncertain; or there is a reasonable likelihood that materially different amounts could be reported under different conditions or using different assumptions and estimates.

For more information on judgements and estimates, refer to note 2 of our September 30, 2024 consolidated interim financial statements.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

Management is responsible for establishing and maintaining adequate internal control over financial reporting ("ICFR"). ICFR is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated interim financial statements for external purposes in accordance with IFRS.

We did not make any changes to ICFR during the three month ended September 30, 2024 that materially affected or are reasonably likely to materially affect our ICFR.

NOTES TO READER

Forward-Looking Information ******

This MD&A contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this MD&A, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "budget", "guidance", "scheduled", "estimates", "forecasts", "strategy", "target", "intends", "objective", "goal", "understands", "anticipates" and "believes" (and variations of these or similar words) and statements that certain actions, events or results "may", "could", "would", "should", "might" "occur" or "be achieved" or "will be taken" (and variations of these or similar expressions). All of the forward-looking information in this MD&A is qualified by this cautionary note.

Forward-looking information includes, but is not limited to, statements with respect to our production, cost and capital and exploration expenditure guidance, our ability to optimize the Copper Mountain mine operation, the implementation of stripping strategies and the expected benefits therefrom, the estimated timelines and pre-requisites for sanctioning the Copper World project and the pursuit of a potential minority joint venture partner, expectations regarding the permitting requirements for the Copper World project (including expected timing for receipt of the Air Quality Permit), the expected benefits of the sanctioning of Copper World project, the expected benefits of Manitoba growth initiatives, including exploration drift at the 1901 deposit, our future deleveraging strategies and our ability to deleverage and repay debt as needed, expectations regarding our cash balance and liquidity, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, the advancement of the exploration program at Maria Reyna and Caballito and the status of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, the ability to continue mining higher-grade ore in the Pampacancha pit and our expectations resulting therefrom, expectations regarding our ability to further reduce greenhouse gas emissions, our evaluation and assessment of opportunities to reprocess tailings using various metallurgical technologies, the anticipated impact of brownfield and greenfield growth projects on our performance, anticipated expansion opportunities and extension of mine life in Snow Lake and our ability to find a new anchor deposit near our Snow Lake operations, anticipated future drill programs and exploration activities and any results expected therefrom, anticipated mine plans, anticipated metals prices and the anticipated sensitivity of our financial performance to metals prices, events that may affect our operations and development projects, anticipated cash flows from operations and related liquidity requirements, the anticipated effect of external factors on revenue, such as commodity prices, estimation of mineral reserves and resources, mine life projections, reclamation costs, economic outlook, government regulation of mining operations, and business and acquisition strategies. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by us at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information.

The material factors or assumptions that we identified and were applied by us in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to:

  • the ability to achieve production, cost and capital and exploration expenditure guidance;

  • no significant interruptions to our operations due to social or political unrest in the regions we operate, including the navigation of the complex political and social environment in Peru;

  • no interruptions to our plans for advancing the Copper World project, including with respect to timely receipt of the Air Quality Permit and the pursuit of a potential joint venture partner;

  • our ability to successfully complete the optimization of the Copper Mountain operations, obtain required permits and develop and maintain good relations with key stakeholders;

  • the ability to execute on its exploration plans and to advance related drill plans;

  • the ability to advance the exploration program at Maria Reyna and Caballito;

  • the success of mining, processing, exploration and development activities;

  • the scheduled maintenance and availability of our processing facilities;

  • the accuracy of geological, mining and metallurgical estimates;

  • anticipated metals prices and the costs of production;

  • the supply and demand for metals we produce;

  • the supply and availability of all forms of energy and fuels at reasonable prices;

  • no significant unanticipated operational or technical difficulties;

  • no significant interruptions to operations due to adverse effects from extreme weather events, including but not limited to forest fires that may affect the regions in which we operate;

  • the execution of our business and growth strategies, including the success of our strategic investments and initiatives;

  • the availability of additional financing, if needed;

  • the ability to deleverage and repay debt, as needed;

  • the ability to complete project targets on time and on budget and other events that may affect our ability to develop our projects;

  • the timing and receipt of various regulatory and governmental approvals;

  • the availability of personnel for our exploration, development and operational projects and ongoing employee relations;

  • maintaining good relations with the employees at our operations;

  • maintaining good relations with the labour unions that represent certain of our employees in Manitoba and Peru;

  • maintaining good relations with the communities in which we operate, including the neighbouring Indigenous communities and local governments;

  • no significant unanticipated challenges with stakeholders at our various projects;

  • no significant unanticipated events or changes relating to regulatory, environmental, health and safety matters;

  • no contests over title to our properties, including as a result of rights or claimed rights of Indigenous peoples or challenges to the validity of our unpatented mining claims;

  • the timing and possible outcome of pending litigation and no significant unanticipated litigation;

  • certain tax matters, including, but not limited to current tax laws and regulations, changes in taxation policies and the refund of certain value added taxes from the Canadian and Peruvian governments; and

  • no significant and continuing adverse changes in general economic conditions or conditions in the financial markets (including commodity prices and foreign exchange rates).

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks related to the failure to effectively complete the optimization and expansion of the Copper Mountain mine operations, political and social risks in the regions we operate, including the navigation of the complex political and social environment in Peru, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, potential tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of our projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks related to the Copper World project, including in relation to permitting, project delivery and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, risks related to extreme weather events, including, forest fires that may affect the regions in which we operate and other severe storms, operational risks and hazards, including the cost of maintaining and upgrading our tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of our reserves, volatile financial markets and interest rates that may affect our ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, our ability to comply with our pension and other post-retirement obligations, our ability to abide by the covenants in our debt instruments and other material contracts, tax refunds, hedging transactions, as well as the risks discussed under the heading "Risk Factors" in our most recent Annual Information Form which is available on the company's SEDAR+ profile at www.sedarplus.ca and the company's EDGAR profile at www.sec.gov.

Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. We do not assume any obligation to update or revise any forward-looking information after the date of this MD&A or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

Note to United States Investors

This MD&A has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers.

Qualified Person and NI 43-101

The technical and scientific information in this MD&A related to our material mineral projects has been approved by Olivier Tavchandjian, P. Geo, Senior Vice President, Exploration and Technical Services. Mr. Tavchandjian is a qualified person pursuant to National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").

For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for our material properties as filed by us on SEDAR+ at www.sedarplus.ca and EDGAR at www.sec.gov.

SUMMARY OF HISTORICAL RESULTS

The following unaudited tables set out a summary of quarterly and annual results for the Company.

Q3 2024 Q2 2024 Q1 2024 2023 ^4^ Q4 2023 Q3 2023 Q2 2023 Q1 2023 2022 ^4^ Q4 2022 Q3 2022
Consolidated Financial Condition (000s)
Cash and cash equivalents and short-term investments $ 483,273 $523,767 $284,385 $249,794 $249,794 $245,217 $179,734 $255,563 $225,665 $225,665 $286,117
Total long-term debt 1,108,900 1,155,575 1,278,587 1,287,536 1,287,536 1,377,443 1,370,682 1,225,023 1,184,162 1,184,162 1,183,237
Net debt1 625,627 631,808 994,202 1,037,742 1,037,742 1,132,226 1,190,948 969,460 958,497 958,497 897,120
Consolidated Financial Performance (000s except per share amounts)
Revenue $ 485,773 $425,520 $524,989 $1,690,030 $602,189 $480,456 $312,166 $295,219 $1,461,440 $321,196 $346,171
Cost of sales 345,987 347,893 373,035 1,297,469 405,433 374,057 289,273 228,706 1,184,552 251,520 313,741
Earnings (loss) before tax 79,701 441 67,750 151,830 80,982 84,149 (30,731) 17,430 95,815 (14,287) (263)
Net (loss) earnings 50,354 (20,377) 18,535 69,543 33,528 45,490 (14,932) 5,457 70,382 (17,441) (8,135)
Net (loss) earnings attributable to owners1 49,762 (16,583) 22,358 66,367 30,717 45,125 (14,932) 5,457 6,567 (17,441) (8,135)
Basic and diluted earnings (loss) per share attributable to owners $ 0.13 $(0.05) $0.06 $0.21 $0.09 $0.13 $(0.05) $0.02 $0.27 $(0.07) $(0.03)
Adjusted earnings (loss) per share attributable to owners 1 $ 0.13 $0.00 $0.17 $0.23 $0.20 $0.07 $(0.07) $0.00 $0.10 $0.01 $(0.05)
Operating cash flow before change in non-cash working capital 186,322 122,028 147,539 569,994 246,528 181,980 55,878 85,608 391,729 109,148 81,617
Adjusted EBITDA (in millions) 1 206.2 145.0 214.2 647.8 274.4 190.7 81.2 101.9 475.9 124.7 99.3
Consolidated Operational Performance
Contained metal in concentrate and doré produced 2
Copper 31,354 28,578 34,749 131,691 45,450 41,964 21,715 22,562 104,173 29,305 24,498
Gold 89,073 58,614 90,392 310,429 112,776 101,417 48,996 47,240 219,700 53,920 53,179
Silver 985,569 738,707 947,917 3,575,234 1,197,082 1,063,032 612,310 702,809 3,161,294 795,015 717,069
Zinc 8,069 8,087 8,798 34,642 5,747 10,291 8,758 9,846 55,381 6,326 9,750
Molybdenum 362 369 397 1,566 397 466 414 289 1,377 344 437
Payable metal in concentrate and doré sold
Copper 27,760 25,799 33,608 124,996 44,006 39,371 23,078 18,541 94,473 25,415 24,799
Gold 73,232 61,295 108,081 276,893 104,840 74,799 47,533 49,720 213,415 47,256 66,932
Silver 663,413 667,036 1,068,848 3,145,166 1,048,877 748,955 805,448 541,884 2,978,485 559,306 816,416
Zinc 3 8,607 5,133 6,119 28,779 7,385 7,125 8,641 5,628 59,043 8,230 12,714
Molybdenum 343 347 415 1,462 468 426 314 254 1,352 421 511
Cash cost 1 $ 0.18 $1.14 $0.16 $0.80 $0.16 $1.10 $1.60 $0.85 $0.86 $1.08 $0.58
Sustaining cash cost 1 $ 1.71 $2.65 $1.03 $1.72 $1.09 $1.89 $2.73 $1.83 $2.07 $2.21 $1.91
All-in sustaining cash cost 1 $ 1.95 $3.07 $1.32 $1.92 $1.31 $2.04 $2.98 $2.07 $2.26 $2.41 $2.16

All values are in US Dollars.

^1^Net debt, adjusted earnings (loss) per share attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A. The above table sets forth selected non-IFRS financial performance measures for each of our nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in our MD&A for these prior periods in the "Non-IFRS Financial Performance Measures" section of these documents.

^2^ Metal reported in concentrate is prior to deductions associated with smelter contract terms.

^3^ Includes refined zinc metal sold. ^4^Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

Q3 2024 Q2 2024 Q1 2024 2023 ^5^ Q4 2023 Q3 2023 Q2 2023 Q1 2023 2022 ^5^ Q4 2022 Q3 2022
Peru Operations
Constancia ore mined^1^ tonnes 3,022,931 5,277,654 2,559,547 9,265,954 973,176 1,242,198 3,647,399 3,403,181 25,840,435 5,614,918 6,300,252
Copper % 0.36 0.29 0.31 0.32 0.30 0.30 0.31 0.34 0.35 0.40 0.36
Gold g/tonne 0.04 0.03 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.05
Silver g/tonne 3.20 2.50 2.79 2.53 2.26 2.91 2.49 2.52 3.40 3.48 3.38
Molybdenum % 0.02 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01
Pampacancha ore mined^1^ tonnes 1,777,092 1,288,789 2,214,354 14,756,416 5,556,613 5,894,013 2,408,495 897,295 8,319,250 3,771,629 2,488,928
Copper % 0.48 0.41 0.56 0.51 0.56 0.53 0.36 0.49 0.33 0.37 0.29
Gold g/tonne 0.27 0.20 0.32 0.33 0.32 0.30 0.34 0.52 0.29 0.29 0.23
Silver g/tonne 6.23 3.83 4.64 4.28 4.84 4.22 2.81 5.12 4.06 3.84 4.30
Molybdenum % 0.01 0.02 0.02 0.01 0.01 0.02 0.02 0.01 0.01 0.01 0.01
Strip Ratio 2.62 1.74 1.95 1.51 1.26 1.36 1.74 1.84 1.13 0.97 1.26
Ore milled tonnes 8,137,248 7,718,962 8,077,962 30,720,929 7,939,044 7,895,109 7,223,048 7,663,728 30,522,294 7,795,735 7,742,020
Copper % 0.32 0.30 0.36 0.39 0.48 0.43 0.31 0.33 0.34 0.41 0.34
Gold g/tonne 0.11 0.07 0.15 0.16 0.25 0.21 0.09 0.08 0.09 0.12 0.08
Silver g/tonne 3.70 2.85 3.48 3.62 4.20 3.75 2.78 3.69 3.58 3.93 3.48
Molybdenum % 0.01 0.01 0.01 0.01 0.01 0.02 0.01 0.01 0.01 0.01 0.01
Copper recovery % 82.6 83.1 84.9 84.2 87.4 85.2 80.0 81.7 85.0 85.1 84.5
Gold recovery % 68.1 61.4 73.4 71.8 77.6 74.8 61.1 56.8 63.6 69.6 61.9
Silver recovery % 67.0 63.9 70.7 70.0 78.0 73.2 65.1 60.7 65.7 66.5 65.2
Molybdenum recovery % 39.0 46.3 43.2 35.8 33.6 37.2 40.5 34.8 34.8 37.7 41.0
Contained metal in concentrate
Copper tonnes 21,220 19,217 24,576 100,487 33,207 29,081 17,682 20,517 89,395 27,047 22,302
Gold ounces 20,331 10,672 29,144 114,218 49,418 40,596 12,998 11,206 58,229 20,860 12,722
Silver ounces 648,209 450,833 639,718 2,505,229 836,208 697,211 419,642 552,167 2,309,352 655,257 564,299
Molybdenum tonnes 362 369 397 1,566 397 466 414 289 1,377 344 437
Payable metal sold
Copper tonnes 18,803 16,806 23,754 96,213 31,200 27,490 21,207 16,316 79,805 23,789 20,718
Gold ounces 9,795 13,433 42,677 97,176 38,114 32,757 14,524 11,781 49,968 15,116 11,970
Silver ounces 365,198 400,302 753,707 2,227,419 703,679 460,001 671,532 392,207 2,045,678 411,129 513,470
Molybdenum tonnes 343 347 415 1,462 468 426 314 254 1,352 421 511
Unit cost ^2,3,4^ $/tonne $ 12.78 $12.68 $10.92 $12.47 $12.24 $12.20 $14.07 $11.47 $12.78 $13.64 $13.06
Peru cash cost^3^ $/lb $ 1.80 $1.78 $0.43 $1.07 $0.54 $0.83 $2.14 $1.36 $1.58 $1.34 $1.68
Peru sustaining cash cost^3^ $/lb $ 2.78 $2.61 $1.06 $1.81 $1.21 $1.51 $3.06 $2.12 $2.35 $2.09 $2.46
^1^ Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not fully reconcile to ore milled.
^2^Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.
^3^Combined unit costs, cash cost, and sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A. The above table sets forth selected non-IFRS financial performance measures for each of our nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in our MD&A for these prior periods in the "Non-IFRS Financial Performance Measures" section of these documents.
^4^ 2022 combined unit costs exclude COVID-19 related costs.
^5^Annual consolidated results may not calculate based on amounts presented in this table due to rounding.
Q3 2024 Q2 2024 Q1 2024 2023 ^1^ Q4 2023 Q3 2023 Q2 2023 Q1 2023 2022 ^1^ Q4 2022 Q3 2022
--- --- --- --- --- --- --- --- --- --- --- --- ---
Manitoba Operations
Lalor ore mined tonnes 411,295 385,478 407,708 1,526,729 372,384 367,491 413,255 373,599 1,516,203 369,453 347,345
Gold g/tonne 5.45 3.75 4.84 4.74 5.92 5.08 4.07 3.96 4.00 4.00 4.57
Copper % 0.91 0.69 0.84 0.86 1.04 1.02 0.81 0.57 0.73 0.73 0.71
Zinc % 2.73 2.76 2.92 3.00 2.20 3.31 3.14 3.32 3.14 2.17 3.27
Silver g/tonne 30.45 22.29 23.44 24.51 28.92 27.80 23.27 18.24 21.96 19.37 21.27
777 ore mined tonnes - - - - - - - - 484,355 - -
Gold g/tonne - - - - - - - - 1.66 - -
Copper % - - - - - - - - 1.12 - -
Zinc % - - - - - - - - 3.83 - -
Silver g/tonne - - - - - - - - 20.85 - -
Stall Concentrator:
Ore milled tonnes 222,621 229,527 219,358 965,567 228,799 255,516 238,633 242,619 968,638 204,350 229,746
Gold g/tonne 4.23 3.02 3.07 3.45 4.22 3.70 3.12 2.78 2.86 2.50 2.81
Copper % 0.89 0.59 0.64 0.74 0.73 0.77 0.85 0.59 0.71 0.61 0.67
Zinc % 4.12 4.05 4.54 4.36 3.20 4.88 4.47 4.81 4.70 3.43 4.82
Silver g/tonne 30.20 21.74 24.46 24.19 28.63 28.82 22.15 17.14 22.81 19.24 20.98
Copper recovery % 88.3 85.4 91.7 90.4 92.0 93.9 88.5 87.0 87.2 89.0 85.8
Zinc recovery % 88.1 87.1 88.4 82.2 78.5 82.6 82.2 84.4 86.6 90.1 88.0
Gold recovery % 70.5 65.5 68.0 64.8 67.5 67.8 59.9 61.9 58.0 62.4 61.3
Silver recovery % 57.8 54.2 59.8 61.4 61.8 64.9 60.3 56.3 56.8 56.6 55.7
New Britannia Concentrator:
Ore milled tonnes 191,298 167,899 170,409 596,912 165,038 146,927 141,905 143,042 542,269 141,142 132,362
Gold g/tonne 6.77 5.31 7.03 6.76 8.03 6.93 5.82 6.05 6.28 6.11 7.70
Copper % 0.93 0.94 1.13 1.03 1.46 1.22 0.77 0.61 0.81 0.91 0.72
Zinc % 1.12 0.92 0.82 0.84 0.85 0.90 0.85 0.76 0.80 0.67 0.73
Silver g/tonne 30.24 24.42 21.60 25.11 27.97 23.88 25.79 22.39 20.97 22.09 20.11
Copper recovery % 92.8 94.4 96.2 93.3 91.6 97.4 91.2 91.7 90.7 89.3 92.3
Gold recovery - concentrate and doré % 90.0 90.0 88.6 88.6 89.0 88.8 88.6 87.9 - - -
Silver recovery - concentrate and doré % 79.9 83.1 82.0 81.4 83.2 82.0 79.6 80.9 - - -
Flin Flon Concentrator:
Ore milled tonnes - - - - - - - - 497,344 - -
Gold g/tonne - - - - - - - - 1.67 - -
Copper % - - - - - - - - 1.11 - -
Zinc % - - - - - - - - 3.87 - -
Silver g/tonne - - - - - - - - 21.00 - -
Copper recovery % - - - - - - - - 86.7 - -
Zinc recovery % - - - - - - - - 83.0 - -
Gold recovery % - - - - - - - - 57.1 - -
Silver recovery % - - - - - - - - 51.8 - -
^1^Annual consolidated results may not calculate based on amounts presented in this table due to rounding.
Q3 2024 Q2 2024 Q1 2024 2023 ^4^ Q4 2023 Q3 2023 Q2 2023 Q1 2023 2022 ^4^ Q4 2022 Q3 2022
--- --- --- --- --- --- --- --- --- --- --- --- ---
Manitoba Operations (continued)
Total Manitoba contained metal in concentrate and doré produced^5^
Gold ounces 62,468 43,488 56,831 187,363 59,863 56,213 35,253 36,034 161,471 33,060 40,457
Copper tonnes 3,398 2,642 3,149 12,154 3,735 3,580 2,794 2,045 14,778 2,258 2,196
Zinc tonnes 8,069 8,087 8,798 34,642 5,747 10,291 8,758 9,846 55,381 6,326 9,750
Silver ounces 281,397 210,647 219,823 851,723 255,579 264,752 180,750 150,642 851,942 139,758 152,770
Total Manitoba payable metal sold in concentrate and doré
Gold ounces 57,238 42,763 62,003 171,297 63,635 36,713 33,009 37,939 163,447 32,140 54,962
Copper tonnes 2,931 2,429 2,921 10,708 3,687 2,925 1,871 2,225 14,668 1,626 4,081
Zinc^1^ tonnes 8,607 5,133 6,119 28,779 7,385 7,125 8,641 5,628 59,043 8,230 12,714
Silver ounces 244,974 197,486 231,841 728,304 246,757 197,952 133,916 149,677 932,807 148,177 302,946
Combined unit cost ^2,3^ C$/tonne $ 211 $225 $235 $217 $216 $217 $220 $216 $195 $241 $235
Gold cash cost ^3^ $/oz $ 372 $771 $736 $727 $434 $670 $1,097 $938 $297 $922 $216
Sustaining gold cash cost ^3^ $/oz $ 553 $1,163 $950 $1,077 $788 $939 $1,521 $1,336 $1,091 $1,795 $1,045
^1^ Includes refined zinc metal sold.
^2^ Reflects combined mine, mill and G&A costs per tonne of milled ore.
^3^ Combined unit costs, cash cost, and sustaining cash cost per pound of copper produced, cash cost, and sustaining cash cost per ounce of gold produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A. The above table sets forth selected non-IFRS financial performance measures for each of our nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in our MD&A for these prior periods in the "Non-IFRS Financial Performance Measures" section of these documents.
^4^Annual consolidated results may not calculate based on amounts presented in this table due to rounding.<br><br> <br>^5^Metal reported in concentrate is prior to deductions associated with smelter terms
Q3 2024 Q2 2024 Q1 2024 2023 ^6^ Q4 2023 Q3 2023 Q2 2023 ^5^ Q1 2023 2022 Q4 2022 Q3 2022
--- --- --- --- --- --- --- --- --- --- --- --- ---
British Columbia Operations ^4^
Ore mined^1^ tonnes 3,098,863 2,164,722 3,722,496 6,975,389 2,627,398 3,792,568 555,423 - - - -
Strip Ratio 6.05 7.61 4.10 3.82 5.34 2.96 - - - - -
Ore milled tonnes 3,363,176 3,232,427 3,180,149 6,862,152 3,261,891 3,158,006 442,255 - - - -
Copper % 0.24 0.25 0.27 0.35 0.33 0.36 0.36 - - - -
Gold g/tonne 0.09 0.07 0.07 0.07 0.06 0.08 0.08 - - - -
Silver g/tonne 0.73 1.01 1.19 1.36 1.36 1.40 1.07 - - - -
Copper recovery % 84.1 82.3 83.4 79.7 78.8 80.90 77.69 - - - -
Gold recovery % 67.3 57.2 61.8 55.9 54.1 56.10 67.90 - - - -
Silver recovery % 71.2 73.9 72.4 73.0 73.8 71.30 78.60 - - - -
Contained metal in concentrate produced
Copper tonnes 6,736 6,719 7,024 19,050 8,508 9,303 1,239 - - - -
Gold ounces 6,274 4,454 4,417 8,848 3,495 4,608 745 - - - -
Silver ounces 55,963 77,227 88,376 218,282 105,295 101,069 11,918 - - - -
Payable metal sold
Copper tonnes 6,026 6,564 6,933 18,075 9,119 8,956 - - - - -
Gold ounces 6,199 5,099 3,401 8,420 3,091 5,329 - - - - -
Silver ounces 53,241 69,248 83,300 189,443 98,441 91,002 - - - - -
Combined unit cost ^2,3^ C$/tonne $ 15.58 $19.65 $23.67 $21.38 $20.90 $24.88 - - - - -
Cash cost^3^ $/lb $ 1.81 $2.67 $3.49 $2.50 $2.67 $2.67 - - - - -
Sustaining cash cost ^3^ $/lb $ 5.06 $5.56 $4.85 $3.41 $3.93 $3.39 - - - - -
^1^ Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not fully reconcile to ore milled.
^2^Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.
^3^Combined unit costs, cash cost, and sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-IFRS Financial Performance Measures" section of this MD&A. The above table sets forth selected non-IFRS financial performance measures for each of our nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in our MD&A for these prior periods in the "Non-IFRS Financial Performance Measures" section of these documents.
^4^ Includes 100% of Copper Mountain mine production. Hudbay owns 75% of Copper Mountain mine.
^5^ Production results from Copper Mountain operations represents the period from the June 20, 2023 acquisition date through to the end of the second quarter of 2023.
^6^ Annual consolidated results may not calculate based on amounts presented in this table due to rounding. 
Hudbay Minerals Inc.: Exhibit 99.3 - Filed by newsfilecorp.com
TSX, NYSE - HBM<br><br> <br>2024 No. 17
25 York Street, Suite 800<br>Toronto, Ontario<br>Canada M5J 2V5<br>tel   416 362-8181<br>fax  416 362-7844<br>hudbay.com News Release

Hudbay Delivers Strong Third Quarter 2024 Results with Record Gold Production in Manitoba; 2024 Production Guidance Reaffirmed and Cost Guidance Further Improved

Toronto, Ontario, November 13, 2024 - Hudbay Minerals Inc. ("Hudbay" or the "company") (TSX, NYSE: HBM) today released its third quarter 2024 financial results. All amounts are in U.S. dollars, unless otherwise noted. All production and cost amounts reflect the Copper Mountain mine on a 100% basis, with Hudbay owning a 75% interest in the mine.

"Our enhanced operating platform delivered strong operating and financial results with record gold production in Manitoba and robust cost control across the business leading to expanded margins," said Peter Kukielski, President and Chief Executive Officer. "The third quarter demonstrated Hudbay's unique copper and gold diversification, providing attractive free cash flow generation and strong leverage to higher metal prices. New quarterly record throughput levels were achieved at the New Britannia mill, higher throughput rates were realized at Constancia, and Copper Mountain delivered record high copper recoveries. We are again improving our 2024 consolidated cash cost guidance as we continue to perform ahead of expectations. We have successfully delivered five consecutive quarters of meaningful free cash flow generation, positioning us well to continue to advance our many growth initiatives and unlock significant value in our pipeline to further enhance our copper exposure."

Delivered Strong Third Quarter Operating and Financial Results, Led by Record Gold Production from Manitoba Operations; 2024 Production Guidance Reaffirmed and Cost Guidance Further Improved

  • Achieved consolidated copper production of 31,354 tonnes, in line with quarterly production cadence, and gold production of 89,073 ounces, far exceeding expectations, in the third quarter of 2024, representing an increase of 10% and 52%, respectively, from the second quarter of 2024.
  • Enhanced operating platform delivered strong quarterly performance with record gold production at the Manitoba operations, the completion of planned stripping activities at Pampacancha in Peru and the benefits from stabilization and optimization initiatives at the Copper Mountain mine in British Columbia.
  • Reaffirmed full year 2024 consolidated production guidance for all metals. Full-year consolidated copper production expected to trend towards the lower end of the guidance range and consolidated gold production expected to trend towards the higher end of the guidance range.
  • Strong operating cost performance with consolidated cash cost^i^ and sustaining cash cost^i^ per pound of copper produced, net of by-product credits^i^, in the third quarter of 2024 of $0.18 and $1.71, respectively, an improvement of 84% and 35%, respectively, from the second quarter of 2024.
  • Further improved 2024 annual operating cost guidance with decreased consolidated cash cost^i^ guidance range of $0.65 to $0.85 per pound, an additional improvement from the previously updated guidance range of $0.90 to $1.10 per pound, and decreased consolidated sustaining cash cost guidance range of $1.75 to $2.20 per pound from original guidance of $2.00 to $2.45 per pound, as a result of increased exposure to gold by-product credits and continued strong cost control across all operations.
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  • Peru operations continued to benefit from strong mill throughput, achieving a quarterly average of approximately 88,000 tonnes per day in the third quarter. The Pampacancha stripping program to advance to higher grades was completed in late September and is on track to achieve higher copper and gold grade ore in the fourth quarter. Peru operations produced 21,220 tonnes of copper and 20,331 ounces of gold in the third quarter of 2024, in line with quarterly cadence expectations. Peru cash cost per pound of copper produced, net of by-product credits^i^, was $1.80 in the third quarter and is expected to improve in the fourth quarter of 2024 with continued strong cost control and higher copper and gold production.
  • Manitoba operations produced 62,468 ounces of gold in the third quarter of 2024, far exceeding management's quarterly cadence expectations and achieving record quarterly production levels as New Britannia continues to operate well above nameplate and budgeted throughput levels and the Lalor mine continues to achieve better-than-expected gold grades. Manitoba cash cost per ounce of gold produced, net of by-product credits^i^, was $372 during the third quarter of 2024, a decrease of 52% compared to the second quarter of 2024. Full-year Manitoba gold production is expected to exceed the top end of the 2024 guidance range.
  • British Columbia operations produced 6,736 tonnes of copper at a cash cost per pound of copper produced, net of by-product credits^i^, of $1.81 in the third quarter of 2024. Achieved record quarterly copper recoveries of 84% and strong unit cost performance as a result of the successful operational stabilization efforts as mine stripping activities accelerate and mill optimization initiatives are underway. Full-year British Columbia copper production is expected to be slightly below the lower end of the 2024 guidance range.
  • Achieved revenue of $485.8 million and operating cash flow before change in non-cash working capital of $186.3 million in the third quarter of 2024. Strong financial results were driven by higher realized gold prices as well as robust gold production in Manitoba, while delivering on higher recovery, throughput and cost control initiatives across all business units.
  • Third quarter net earnings attributable to owners and earnings per share attributable to owners were $49.8 million and $0.13, respectively. After adjusting for items on a pre-tax basis such as a non-cash gain of $2.0 million related to a quarterly revaluation of the closed site environmental reclamation provision, a $5.2 million mark-to-market revaluation loss on various instruments such as the gold prepayment liability, unrealized strategic gold and copper hedges, investments and share-based compensation and a $2.2 million write-down of PP&E, among other items, third quarter adjusted earnings^i^ per share attributable to owners was $0.13.
  • Adjusted EBITDA^i^ was $206.2 million during the third quarter of 2024, a 42% increase compared to the second quarter of 2024.
  • Cash and cash equivalents and short-term investments increased by $233.5 million to $483.3 million during the first nine months of 2024 due to a successful equity offering and strong operating cash flows bolstered by higher copper and gold prices, which enabled a $412.1 million reduction in net debt^i^ during the first nine months of 2024.

Accelerated Deleveraging and Improved Balance Sheet Flexibility

  • Hudbay's unique copper and gold diversification in Peru and North America provides exposure to higher copper and gold prices and attractive free cash flow generation.
  • While a majority of revenues continue to be from copper, gold is representing an increasing portion of total revenues at 36% in the third quarter of 2024 and 33% year-to-date, compared to 27% and 26%, respectively, for the same periods in 2023, driven by higher gold production and strong leverage to higher gold prices.
  • During the third quarter of 2024, deleveraging efforts continued with additional open market purchases of approximately $48.5 million of Hudbay's senior unsecured notes in July and August 2024 at a discount. Long-term debt reduced to $1,108.9 million at September 30, 2024 from $1,287.5 million at December 31, 2023.
  • On August 30, 2024, Hudbay completed the final monthly payment to settle the gold prepayment liability that was used to fund the refurbishment of the New Britannia gold mill. The elimination of the gold prepayment liability will further increase the company's exposure to higher gold production in Snow Lake.
TSX, NYSE - HBM<br><br> <br>2024 No. 17
  • Impressive operating cash flow before change in non-cash working capital generation of $186.3 million despite lower realized copper prices compared to the second quarter of 2024, capitalizing on higher gold production from Manitoba following the full repayment of the gold prepayment liability in August.
  • Achieved trailing 12 month adjusted EBITDA^i^ of $839.8 million, a substantial increase from $498.5 million for the 12 months ending September 30, 2023.
  • Reduced net debt^i^ to $625.6 million in the third quarter of 2024. The third quarter represents the fifth consecutive quarter of lower net debt as a result of deleveraging efforts and capitalizing on strong operating cash flow generation.
  • The increase in cash and reduction in long-term debt significantly reduced the company's net debt to adjusted EBITDA^i^ to 0.7x at September 30, 2024 compared to 1.6x at the end of 2023, well within the targeted 1.2x net debt to adjusted EBITDA^i^ ratio outlined in the three prerequisites plan (the "3-P plan") for advancing Copper World, including receipts of permits, a robust definitive feasibility study plan and a prudent financing strategy.
  • Total liquidity substantially increased by 58% to $907.7 million at September 30, 2024 from $573.7 million at the end of 2023.
  • Subsequent to the quarter end, further improved long-term balance sheet resilience with a proactive three-year extension of the company's senior secured revolving credit facilities from October 2025 to November 2028. The extended credit facilities provide increased financial flexibility to accretively maintain the 4.50% coupon 2026 senior unsecured notes outstanding to maturity and advance Copper World towards a sanctioning decision in accordance with the 3-P plan. The $450 million revolving credit facility includes an improved pricing grid reflecting the enhanced financial position of Hudbay and features an opportunity to increase the facility by an additional $150 million at Hudbay's discretion during the four-year tenor, providing additional financial flexibility.

Advancing Growth Initiatives to Further Enhance Copper and Gold Exposure

  • The successful completion of the planned stripping program at Pampacancha in September is expected to lead to significantly higher copper and gold grades in the fourth quarter of 2024, which together with maintaining strong operating performance at Constancia is expected to continue to generate meaningful free cash flow in Peru.
  • The New Britannia mill continued to exceed expectations, driving continued strong gold production and free cash flow generation in Manitoba. The New Britannia mill achieved record throughput levels of approximately 2,080 tonnes per day in the third quarter, exceeding its original design capacity of 1,500 tonnes per day and its 2024 budgeted capacity of 1,800 tonnes per day due to the successful implementation of process improvement initiatives and effective preventative maintenance measures.
  • Hudbay has successfully implemented post-acquisition plans to stabilize the Copper Mountain operations through mining fleet ramp-up activities and increased mill reliability and performance. Achieved record mill availability of 95% and record copper recoveries of 84% in the third quarter of 2024. Efforts are now focused on optimizing the operations through execution of the planned accelerated stripping program and mill throughput improvement projects.
  • Received the Aquifer Protection Permit for Copper World in August, a key milestone and de-risking event in the advancement of the project. Continued to progress the 3-P plan for sanctioning Copper World, with transformed balance sheet near targeted levels and the remaining key state permit progressing on track. As disclosed in August, Hudbay commenced activities related to the preparation of feasibility studies for Copper World, resulting in an expected increase of $25 million in growth capital spending in Arizona.
  • Drill permitting for highly prospective Maria Reyna and Caballito properties near Constancia continues to advance through the multi-step regulatory process with the environmental impact assessment applications approved for Maria Reyna in June and Caballito in September.
  • The development of an access drift to the 1901 deposit in Snow Lake remains on track to reach mineralization in early 2025 and is intended to enable confirmation of the optimal mining method for the deposit and underground drilling to further evaluate the orebody and upgrade inferred gold resources to reserves. Initiated the development of an adjacent haulage drift to de-risk planned full production in 2027.
TSX, NYSE - HBM<br><br> <br>2024 No. 17
  • Large 2024 exploration program continues in Snow Lake with eight drill rigs testing targets near Lalor and regional satellite properties. Includes follow-up drilling at Lalor Northwest located 400 metres from Lalor's underground infrastructure and the testing of a deep geophysical target at the Cook Lake North property.
  • Continuing to advance Flin Flon tailings reprocessing opportunities through metallurgical test work and early economic evaluation to assess the possibility of producing critical minerals and precious metals while reducing the environmental footprint.

Summary of Third Quarter Results

Consolidated copper production of 31,354 tonnes in the third quarter of 2024 increased by 10% from the second quarter of 2024, in line with the mine plan expectations. Consolidated gold production of 89,073 ounces in the third quarter exceeded expectations and increased by 52% from the second quarter of 2024. Stronger gold production was driven by higher gold grades and mill throughput in all operations, but most notably at the New Britannia mill in Manitoba. With the completion of the planned stripping program in Peru at the end of the third quarter, post-quarter production results have already delivered higher grades as mining of the high-grade zones at Pampacancha is underway, in line with the mine plan.

In the third quarter of 2024, consolidated cash cost per pound of copper produced, net of by-product credits^i^, was $0.18, compared to $1.14 in the second quarter of 2024. This decrease was mainly the result of significantly higher by-product credits, higher copper production and strong cost control leading to lower mining, milling, treatment and refining costs. Consolidated sustaining cash cost per pound of copper produced, net of by-product credits^i^, was $1.71 in the third quarter of 2024 compared to $2.65 in the second quarter of 2024. This decrease was primarily due to the same reasons outlined above partially offset by higher cash sustaining capital expenditures. Consolidated all-in sustaining cash cost per pound of copper produced, net of by-product credits^i^, was $1.95 in the third quarter of 2024, lower than $3.07 in the second quarter of 2024 due to significant gold by-product credits and continued strong cost control across all operations.

Cash generated from operating activities of $146.2 million increased by 6% in the third quarter of 2024 compared to the second quarter of 2024. Operating cash flow before change in non-cash working capital was $186.3 million during the third quarter of 2024, reflecting a 53% increase compared to the second quarter of 2024. The increase in operating cash flows before change in non-cash working capital was primarily the result of higher gold production and sales volumes in Manitoba, strong operational cost performance across the business and higher realized gold prices. Third quarter adjusted EBITDA^i^ was $206.2 million, a 42% increase compared to $145.0 million in the second quarter of 2024 and was impacted by the same factors affecting operating cash flow as noted above.

Net earnings attributable to owners in the third quarter of 2024 was $49.8 million, or $0.13 per share, compared to net loss attributable to owners in the second quarter of 2024 of $16.6 million, or $0.05 per share, which was impacted by various non-cash charges for unrealized losses on strategic copper and gold hedges and revaluation of share-based compensation due to a higher share price.

Adjusted net earnings attributable to owners^i^ in the third quarter of 2024 were $50.3 million, or $0.13 per share, after adjusting for items on a pre-tax basis such as a non-cash gain of $2.0 million related to a quarterly revaluation of closed site environmental reclamation provision, a $5.2 million mark-to-market revaluation loss on various instruments such as the gold prepayment liability, unrealized strategic gold and copper hedges, investments and stock based compensation and a $2.2 million write-down of PP&E, among other items. This compares to adjusted net earnings attributable to owners^i^ of $0.1 million, or nil per share, in the second quarter of 2024.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

As at September 30, 2024, total liquidity was $907.7 million, including $443.3 million in cash and cash equivalents, $40.0 million in short-term investments as well as undrawn availability of $424.4 million under the company's revolving credit facilities. Net debt^i^ declined to $625.6 million at the end of the third quarter of 2024 compared to $1,037.7 million at the end of 2023.

Consolidated Financial Condition ($000s) Sep. 30, 2024 Jun. 30, 2024 Dec. 31, 2023
Cash and cash equivalents and short-term investments 483,273 523,767 249,794
Total long-term debt 1,108,900 1,155,575 1,287,536
Net debt^1^ 625,627 631,808 1,037,742
Working capital^2^ 434,346 423,793 135,913
Total assets 5,508,075 5,442,422 5,312,634
Equity^3^ 2,537,845 2,482,545 2,096,811
Net debt to adjusted EBITDA^1,^^4^ 0.7 0.8 1.6

^1^ Net debt and net debt to adjusted EBITDA are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-IFRS Financial Performance Measures" section of this news release.

^2^Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated interim financial statements.

^3^ Equity attributable to owners of the company.

^4^Net debt to adjusted EBITDA for the 12 month period.

Consolidated Financial Performance **** Three Months Ended
**** Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Revenue $000s 485,773 425,520 480,456
Cost of sales $000s 345,987 347,893 374,057
Earnings (loss) before tax $000s 79,701 441 84,149
Net (loss) earnings $000s 50,354 (20,377) 45,490
Net (loss) earnings attributable to owners $000s 49,762 (16,583) 45,125
Basic earnings (loss) per share^1^ $/share 0.13 (0.05) 0.13
Adjusted earnings (loss) per share^1,^^2^ $/share 0.13 0.00) 0.07
Operating cash flow before change in non-cash working capital $ millions 186.3 122.0 182.0
Adjusted EBITDA^2^ $ millions 206.2 145.0 190.7

^1^ Attributable to owners of the company. ^2^ Adjusted earnings (loss) per share attributable to owners and adjusted EBITDA are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-IFRS Financial Performance Measures" section.

TSX, NYSE - HBM<br><br> <br>2024 No. 17
Consolidated Production and Cost Performance Three Months Ended
--- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Contained metal in concentrate and doré produced^1^
Copper tonnes 31,354 28,578 41,964
Gold ounces 89,073 58,614 101,417
Silver ounces 985,569 738,707 1,063,032
Zinc tonnes 8,069 8,087 10,291
Molybdenum tonnes 362 369 466
Payable metal sold
Copper tonnes 27,760 25,799 39,371
Gold^2^ ounces 73,232 61,295 74,799
Silver^2^ ounces 663,413 667,036 748,955
Zinc tonnes 8,607 5,133 7,125
Molybdenum tonnes 343 347 426
Consolidated cash cost per pound of copper produced^3^
Cash cost $/lb 0.18 1.14 1.10
Sustaining cash cost $/lb 1.71 2.65 1.89
All-in sustaining cash cost $/lb 1.95 3.07 2.04

^1^ Metal reported in concentrate is prior to deductions associated with smelter contract terms.

^2^ Includes total payable gold and silver in concentrate and in doré sold.

^3^ Cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-IFRS Financial Performance Measures" section of this news release.

2024 Production Guidance Reaffirmed and Cash Cost Guidance Further Improved

Hudbay reaffirms its full year 2024 consolidated production guidance for all metals as the company continues to deliver strong operating performance and expects the fourth quarter to be the highest copper production quarter in 2024, in line with the company's quarterly cadence expectations. The company expects 2024 consolidated copper production to trend towards the lower end of the guidance range and 2024 consolidated gold production to trend towards the higher end of the guidance range.

In Peru, the fourth quarter is expected to be the strongest quarter this year, and full year copper production is expected to trend towards the lower end of the guidance range, while gold production is expected to trend towards the higher end of the guidance range. In British Columbia, Hudbay expects to continue improving operating efficiencies in the fourth quarter, and full year copper production is expected to be slightly below the lower end of the guidance range, while full year gold production is expected to be within the guidance ranges.

In Manitoba, Hudbay expects the strong operating performance to continue into the fourth quarter, and full year gold production is now expected to exceed the top end of the guidance range and full year copper production is expected to trend towards the higher end of the guidance range.

Hudbay is again improving its full year 2024 consolidated cash cost guidance range to $0.65 to $0.85 per pound copper from the previously announced range of $0.90 to $1.10 per pound and the original guidance range of $1.05 to $1.25 per pound. The company is also improving its 2024 annual consolidated sustaining cash cost guidance range to $1.75 to $2.20 per pound copper from the original guidance range of $2.00 to $2.45 per pound. This is a result of increased exposure to gold by-product credits and continued strong cost control at all operations. The company has reaffirmed all other 2024 guidance metrics.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Peru Operations Review

Peru Operations Three Months Ended
****** Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Constancia ore mined^1^ **** tonnes 3,022,931 5,277,654 1,242,198
Copper % 0.36 0.29 0.30
Gold g/tonne 0.04 0.03 0.04
Silver g/tonne 3.20 2.50 2.91
Molybdenum % 0.02 0.01 0.01
Pampacancha ore mined^1^ tonnes 1,777,092 1,288,789 5,894,013
Copper % 0.48 0.41 0.53
Gold g/tonne 0.27 0.20 0.30
Silver g/tonne 6.23 3.83 4.22
Molybdenum % 0.01 0.02 0.02
Total ore mined tonnes 4,800,023 6,566,443 7,136,211
Strip ratio^4^ 2.62 1.74 1.36
Ore milled tonnes 8,137,248 7,718,962 7,895,109
Copper % 0.32 0.30 0.43
Gold g/tonne 0.11 0.07 0.21
Silver g/tonne 3.70 2.85 3.75
Molybdenum % 0.01 0.01 0.02
Copper recovery % 82.6 83.1 85.2
Gold recovery % 68.1 61.4 74.8
Silver recovery % 67.0 63.9 73.2
Molybdenum recovery % 39.0 46.3 37.2
Contained metal in concentrate ****
Copper tonnes 21,220 19,217 29,081
Gold ounces 20,331 10,672 40,596
Silver ounces 648,209 450,833 697,211
Molybdenum tonnes 362 369 466
Payable metal sold ****
Copper tonnes 18,803 16,806 27,490
Gold ounces 9,795 13,433 32,757
Silver ounces 365,198 400,302 460,001
Molybdenum tonnes 343 347 426
Combined unit operating cost^2,^^3^ $/tonne 12.78 12.68 12.20
Cash cost^3^ $/lb 1.80 1.78 0.83
Sustaining cash cost^3^ $/lb 2.78 2.61 1.51

^1^Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

^2^Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

^3^ Combined unit costs, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-IFRS Financial Performance Measures" section of this news release.

^4^ Strip ratio is calculated as waste mined divided by ore mined.

During the third quarter of 2024, the Peru operations produced 21,220 tonnes of copper, 20,331 ounces of gold, 648,209 ounces of silver and 362 tonnes of molybdenum. Copper, gold and silver production was higher than the second quarter of 2024 as the operations continued to benefit from strong mill throughput, averaging approximately 87,000 tonnes processed per day year-to-date and achieving an average of 88,000 tonnes per day in the third quarter. Year-to-date cost performance was also strong, despite lower grades milled, achieving lower unit operating costs, cash cost and sustaining cash cost compared to the comparative 2023 period. Cash cost also benefited from higher gold by-product sales revenues throughout 2024. The planned stripping program at Pampacancha was completed in late September, and mining activities at Pampacancha are now focused on the next mining phase to deliver higher copper and gold grades in the fourth quarter of 2024.

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Total ore mined in the third quarter of 2024 decreased by 27% compared to the second quarter, in line with the mine plan. Ore mined from Pampacancha during the third quarter increased to 1.8 million tonnes compared to 1.3 million tonnes in the second quarter with the completion of the planned stripping program at Pampacancha in late September.

Ore milled during the third quarter of 2024 increased by 5% compared to the second quarter mainly as a result of the treatment of softer ore from stockpiles. Similar to the second quarter, ore milled included supplemental ore feed from stockpiles during the quarter as the team completed pit stripping activities. Milled copper and gold grades increased by 7% and 57%, respectively, in the third quarter of 2024 compared to the second quarter with higher grades being mined in both the Constancia and Pampacancha pits and an increase in ore mined from Pampacancha.

Recoveries of copper and gold during the third quarter of 2024 were 83% and 68%, respectively, with copper recoveries relatively unchanged from the second quarter while gold recoveries increased by 11%. This was in line with the metallurgical models for the ore types that were being processed. Copper and gold recoveries are expected to increase in the fourth quarter as more higher grade ore is processed and less stockpile ore is used to supplement mill feed.

Combined mine, mill and G&A unit operating costs^i^ were $12.78 per tonne in the third quarter of 2024, 1% higher than the second quarter of 2024 primarily due to higher mining costs, partially offset by lower milling costs and higher ore milled.

Cash cost per pound of copper produced, net of by-product credits^i^, was $1.80 in the third quarter of 2024, relatively unchanged from $1.78 in the second quarter of 2024 as higher copper production offset higher mining and freight costs and lower by-product credits.

Sustaining cash cost per pound of copper produced, net of by-product credits^i^, was $2.78 in the third quarter of 2024, higher than $2.61 the second quarter of 2024 due to higher sustaining capital expenditures.

Hudbay expects to achieve its 2024 production and cost guidance range for all metals in Peru as the fourth quarter is expected to be the strongest quarter in Peru in 2024. Peru 2024 full year copper production is expected to trend towards the lower end of the guidance range due to lower than expected grades, while gold production is expected to trend towards the higher end of the guidance range due to a larger portion of the feed coming from higher gold grade Pampacancha stockpiles. Cash cost is expected to be favourably positioned at the lower end of the cost guidance range primarily due to high gold by-product credits.

The company is evaluating opportunities to further increase mill throughput in the medium-to-long-term after the Peruvian Ministry of Energy and Mines approved a regulatory change in June 2024 to allow mining companies in Peru to increase throughput by up to 10% above permitted levels.

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Manitoba Operations Review

Manitoba Operations
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Lalor
Ore mined tonnes 411,295 385,478 367,491
Gold g/tonne 5.45 3.75 5.08
Copper % 0.91 0.69 1.02
Zinc % 2.73 2.76 3.31
Silver g/tonne 30.45 22.29 27.80
New Britannia ****
Ore milled tonnes 191,298 167,899 146,927
Gold g/tonne 6.77 5.31 6.93
Copper % 0.93 0.94 1.22
Zinc % 1.12 0.92 0.90
Silver g/tonne 30.24 24.42 23.88
Gold recovery^1^ % 90.0 90.0 88.8
Copper recovery % 92.8 94.4 97.4
Silver recovery^1^ % 79.9 83.1 82.0
Stall Concentrator **** ****
Ore milled tonnes 222,621 229,527 255,516
Gold g/tonne 4.23 3.02 3.70
Copper % 0.89 0.59 0.77
Zinc % 4.12 4.05 4.88
Silver g/tonne 30.20 21.74 28.82
Gold recovery % 70.5 65.5 67.8
Copper recovery % 88.3 85.4 93.9
Zinc recovery % 88.1 87.1 82.6
Silver recovery % 57.8 54.2 64.9
Total contained metal in concentrate and doré^1^
Gold ounces 62,468 43,488 56,213
Copper tonnes 3,398 2,642 3,580
Zinc tonnes 8,069 8,087 10,291
Silver ounces 281,397 210,647 264,752
Total payable metal sold **** ****
Gold ounces 57,238 42,763 36,713
Copper tonnes 2,931 2,429 2,925
Zinc tonnes 8,607 5,133 7,125
Silver ounces 244,974 197,486 197,952
Combined unit operating cost^2,3^ C/tonne 211 225 217
Gold cash cost /oz 372 771 670
Gold sustaining cash cost^3^ /oz 553 1,163 939

All values are in US Dollars.

^1^ Gold and silver recovery includes total recovery from concentrate and doré.  ^2^Combined unit cost, cash cost, sustaining cash cost per pound of copper produced, net of by-product credits, gold cash cost and sustaining cash cost per ounce of gold produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-IFRS Financial Performance Measures" section of this news release. ^3^Reflects combined mine, mill and G&A costs per tonne of ore milled.

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The Manitoba operations delivered record results during the third quarter of 2024, continuing to exceed expectations in performance and efficiency. The operations achieved a new quarterly record for gold production at 62,468 ounces in the third quarter of 2024, representing a 44% increase from the second quarter of 2024. The operations also produced 3,398 tonnes of copper, 8,069 tonnes of zinc and 281,397 ounces of silver during the third quarter of 2024, with copper and silver being 29% and 34% higher, respectively, than the second quarter and zinc relatively unchanged. The increased gold and silver production in the quarter is due to the company's strategy of mining and allocating more Lalor gold ore feed to New Britannia to achieve higher recoveries, combined with higher grade ore mined in the quarter.

Total ore mined at Lalor in the third quarter of 2024 was 7% higher than the second quarter of 2024. Gold, copper and silver grades mined were 45%, 32% and 37% higher, respectively, compared with the second quarter of 2024, while zinc grades mined were 1% lower. Performance from the Lalor mine was strong, benefiting from improved longhole muck fragmentation and a consistent higher-grade mining sequence that surpassed forecasted metal grades. In August, the company successfully completed a five-day planned maintenance program aimed at enhancing the efficiency and reliability of the key infrastructure at the mine. Ongoing modifications to stope design further enhanced mucking efficiency throughout the lifecycle of stopes.

The New Britannia mill had another quarter of exceptional performance with the mill operating consistently above nameplate capacity of 1,500 tonnes per day and achieving a new quarterly record with an average throughput of 2,080 tonnes per day in the third quarter. Plant availability continues to improve, supported by low-capital projects aimed at further increasing throughput while continuing to achieve targeted gold recoveries of 90%. These efforts align with the long-term objectives of maximizing gold production by processing more high-grade ore from Lalor through the New Britannia mill, leading to higher gold recoveries. Notably, enhancements in the elution and stripping cycles contributed to increased gold doré production. Recoveries of gold, copper and silver at New Britannia were 90%, 93% and 80%, respectively, in the third quarter of 2024.

At the Stall mill, there was a slight reduction in throughput as more ore was diverted to New Britannia. Benefits from recent recovery improvement programs continue to be realized with gold recoveries of 71% and 68% achieved in the third quarter and year-to-date, respectively, compared to 64% in the first nine months of 2023. Efforts to continue to optimize recovery were advanced with the installation of new elongated cyclones in one of the two milling circuits late in third quarter. These cyclones are designed to improve grind size and, pending positive performance results, could be implemented across other circuits. Additionally, transitioning operational and maintenance responsibilities for the external crusher from contractors to the in-house team has resulted in more efficient cost management, supporting long-term savings at the Snow Lake operations.

Combined mine, mill and G&A unit operating costs^i^ in the third quarter of 2024 were C$211 per tonne, representing a 6% decrease compared to the second quarter of 2024 as a result of higher tonnes processed and lower mining costs, partially offset by higher milling costs.

Cash cost per ounce of gold produced, net of by-product credits^i^, in the third quarter of 2024 was $372, a meaningful decrease of 52% compared to second quarter of 2024 due to significantly higher gold production and higher by-product credits, partially offset by higher milling, G&A and freight costs.

Sustaining cash cost per ounce of gold produced, net of by-product credits^i^, in the third quarter of 2024 was $553, a meaningful decrease of 52% compared to the second quarter of 2024, primarily due to the same factors affecting cash cost and lower sustaining capital expenditures during the quarter.

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Hudbay now expects to exceed the top end of the 2024 gold production guidance range in Manitoba driven by outperformance at New Britannia with throughput achieving new record levels and the Lalor mine delivering better-than-expected gold grades by focusing on ore quality improvements. The company also expects Manitoba copper production to trend towards the higher end of the 2024 guidance range and is well on track to achieve zinc and silver 2024 production guidance. Similarly, the company expects 2024 gold cash cost to be favourably positioned at the lower end of the cost guidance range, reflecting the strong cost control and gold production achieved to date.

Progress on the 1901 exploration drift is on track to intersect mineralization by early 2025, laying the groundwork for the 1901 haulage drift that will support full production from the 1901 deposit by 2027. Diamond drilling will soon follow to evaluate the orebody and optimize the mining approach for future conversion of inferred mineral resources into mineral reserves.

Environmental initiatives continue to progress well in Manitoba. At the Anderson tailings facility, enhanced deposition efficiency enabled deferral of dam construction capital to future years, while a new trial exploring alternative shore deposition techniques shows promising potential for further gains in efficiency. The operations remain on track to meet their environmental targets for 2024, with significant reductions in propane and diesel consumption achieved year-to-date compared to 2023. In addition, an initiative at Lalor to recycle natural groundwater for use as process water has successfully reduced the mine's reliance on fresh water.

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British Columbia Operations Review

British Columbia Operations^1^ Three Months Ended
****** Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Ore mined^2^ tonnes 3,098,863 2,164,722 3,792,568
Strip ratio^3^ 6.05 7.61 2.96
Ore milled tonnes 3,363,176 3,232,427 3,158,006
Copper % 0.24 0.25 0.36
Gold g/tonne 0.09 0.07 0.08
Silver g/tonne 0.73 1.01 1.40
Copper recovery % 84.1 82.3 80.9
Gold recovery % 67.3 57.2 56.1
Silver recovery % 71.2 73.9 71.3
Total contained metal in concentrate^3^ ****
Copper tonnes 6,736 6,719 9,303
Gold ounces 6,274 4,454 4,608
Silver ounces 55,963 77,227 101,069
Total payable metal sold ****
Copper tonnes 6,026 6,564 8,956
Gold ounces 6,199 5,099 5,329
Silver ounces 53,241 69,248 91,002
Combined unit operating cost^4^^,^^5^ C$/tonne 15.58 19.65 24.88
Cash cost^5^ $/lb 1.81 2.67 2.67
Sustaining cash cost^5^ $/lb 5.06 5.56 3.39

^1^Copper Mountain mine results are stated at 100%. Hudbay owns 75% of Copper Mountain mine.

^2^Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

^3^Strip ratio is calculated as waste mined divided by ore mined.

^4^ Reflects combined mine, mill and G&A costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

^5^ Combined unit operating cost, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-IFRS Financial Performance Measures" section of this news release.

Since acquiring Copper Mountain in June 2023, Hudbay has been focused on advancing operational stabilization plans, including opening up the mine by re-activating the full mining fleet, adding additional mining faces, optimizing the ore feed to the plant and implementing plant improvement initiatives that mirror the successful processes at Constancia. These stabilization plans have successfully increased the total tonnes moved and resulted in stronger mill performance as demonstrated by record high mill availability of 95% and above-target copper recoveries of 84% in the third quarter of 2024. As a result, year-to-date mill performance has resulted in the highest mill availability and highest copper recoveries achieved at the Copper Mountain mine in the last decade. Similarly, the stabilization efforts have successfully reduced combined unit operating costs to C$19.56 per tonne year-to-date, compared to C$21.38 per tonne milled in second half of 2023 (or first six months since acquisition).

Efforts are now focused on optimizing the operations throughout the balance of 2024 and into 2025. Mining activities will continue to execute the three-year accelerated stripping program intended to bring higher grade ore into the mine plan. Feasibility engineering has commenced to debottleneck and increase the nominal plant capacity to its permitted capacity of 50,000 tonnes per day earlier than contemplated in the most recent technical report.

During the third quarter of 2024, the British Columbia operations produced 6,736 tonnes of copper, 6,274 ounces of gold and 55,963 ounces of silver. Copper production was slightly higher than the second quarter of 2024, while gold production increased by 41% and silver production decreased by 28% compared to the second quarter of 2024. This was primarily a result of the head grades from the use of stockpiled ore to feed the mill.

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Total ore mined at Copper Mountain in the third quarter of 2024 was 3.1 million tonnes, an increase of 43% compared to the second quarter of 2024. As planned, ore stockpiles were utilized as ore feed to the mill while the mine operation team increased waste stripping activities. Total material moved continued to ramp up in the quarter to 23.0 million tonnes, compared to 16.5 million tonnes in the same period last year, as a result of effective usage of the mining fleet to execute the accelerated stripping program to access higher head grades. The focus in the third quarter of 2024 was on mining efficiencies and operator recruitment to effectively utilize the available haul trucks fleet. As a result, total material moved is expected to continue to increase quarter-over-quarter as per the mine plan.

The mill processed 3.4 million tonnes of ore during the third quarter of 2024, a 4% increase compared to the second quarter of 2024, benefiting from stabilization and reliability initiatives within the mill processing circuit. The average mill availability during the quarter increased to 95%, while maintaining a stable throughput rate. Mill throughput in the third quarter of 2024 was limited by unplanned maintenance and elevated clay material which impacted the second crushing circuit. During the third quarter, a number of initiatives were advanced to address these issues and other identified constraints and to improve throughput to targeted levels, with the benefits expected to be realized in the fourth quarter of 2024.

Copper recoveries of 84.1% in the third quarter of 2024 were higher than the second quarter, exceeding management's expectations despite processing lower grades as the operations improved the regrind circuit constraint and implemented the flotation operational strategy improvements, including reagent selection and dose modification. Similarly, milled gold grades were higher in the third quarter than in the second quarter of 2024, resulting in higher gold recoveries of 67.3% in the third quarter of 2024.

Combined mine, mill and G&A unit operating costs in the third quarter of 2024 were C$15.58 per tonne milled, 21% lower than the second quarter of 2024. This is primarily due to lower mining and milling costs, higher ore milled and the benefits from the various stabilization initiatives implemented over the course of this year. Combined unit operating costs are expected to continue to benefit from the execution of the accelerated stripping program and the implementation of optimization initiatives at Copper Mountain.

Cash cost per pound of copper produced, net of by-product credits^i^, in the third quarter of 2024 was $1.81. Cash cost was 32% lower than the second quarter of 2024 for the same reasons as mentioned above regarding the unit cost variance.

Sustaining cash cost per pound of copper produced, net of by-product credits^i^, in the third quarter of 2024 was $5.06, 9% lower than the second quarter of 2024. This improved for the same reasons as mentioned above, partially offset by higher sustaining capital expenditures.

Hudbay expects to be slightly below the low end of the 2024 guidance range for copper production in British Columbia as a result of lower grades in stockpiled ore and the ramp-up of stabilization efforts throughout the year. The company expects gold and silver production to be within the 2024 guidance range in British Columbia. Cash cost for the nine months ended September 30, 2024 was above the higher end of the 2024 guidance range; however, Hudbay anticipates fourth quarter cash cost to continue to improve, which is expected to result in full year cash cost to be near the upper end of the 2024 cost guidance range.

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Continued Debt Reduction and Improved Balance Sheet Flexibility

The company took several prudent measures in the third quarter of 2024 to further improve its balance sheet strength and flexibility:

• Repurchased and retired an additional $48.5 million of senior unsecured notes - The company made open market purchases of $13.4 million of the 2026 senior unsecured notes and $35.1 million of the 2029 senior unsecured notes during the quarter. As a result, a total of $82.6 million of senior unsecured notes have been repurchased and retired since the beginning of the year.

• Delivered the final $16.9 million under gold forward sale and prepay agreement - Hudbay completed the last monthly gold delivery in August 2024, resulting in the full repayment of the gold prepay facility which was used to fund the refurbishment of the New Britannia gold mill.

• Three-year extension of revolving credit facilities to 2028 - Subsequent to the quarter end, Hudbay proactively extended its senior secured revolving credit facilities by three years from October 2025 to November 2028 and negotiated the flexibility to leave the company's 4.50% 2026 senior unsecured notes outstanding to maturity as the company advances Copper World towards a sanctioning decision in accordance with the 3-P plan. The newly extended $450 million revolving credit facility, with the existing banking syndicate, includes an improved pricing grid reflecting the enhanced financial position of Hudbay, and features an opportunity to increase the facility by an additional $150 million at Hudbay's discretion during the four-year tenor, providing additional financial flexibility. The revolving credit facilities are currently undrawn (excluding letters of credit), having repaid $100 million of prior drawings associated with the Copper Mountain acquisition in the first half of 2024.

Hudbay has delivered five consecutive quarters of meaningful free cash flow generation as a result of recent brownfield investments in its operations, continuous improvement efforts and steady cost control across the business. In the last twelve months, the company has repaid a total of $296 million of debt and gold prepay liabilities.

As a result of continued deleveraging efforts and cash flow generation, the company has substantially reduced net debt^i^ to $625.6 million at September 30, 2024 from $1,037.7 million at the end of 2023. The net debt reduction, together with higher levels of adjusted EBITDA^i^ over the last twelve months, has significantly improved Hudbay's net debt to adjusted EBITDA ratio^i^ to 0.7x compared to 1.6x at the end of 2023. The improved balance sheet flexibility and accelerated debt reduction significantly advances the company's progress as part of its 3-P plan for sanctioning Copper World, and results in the successful achievement of the targeted 1.2x net debt to 12-month trailing adjusted EBITDA ratio well ahead of schedule.

Advancing Permitting at Copper World

In August 2024, Hudbay received the Aquifer Protection Permit for the Copper World project from the Arizona Department of Environmental Quality ("ADEQ"). The company proactively engaged with the ADEQ, ensuring a transparent and thorough permitting process by providing comprehensive and detailed information. The issuance of this permit is a key milestone in the advancement of Copper World, which is a standalone operation requiring state and local permits and is expected to produce 85,000 tonnes of copper per year over a 20-year mine life.

There are three key state permits required for Copper World sanctioning:

• Mined Land Reclamation Plan - Completed ****** - the Mined Land Reclamation Plan was initially approved by the Arizona State Mine Inspector in October 2021 and was subsequently amended and approved to reflect a larger private land project footprint. This approval was challenged in state court, but the challenge was dismissed in May 2023.

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• Aquifer Protection Permit - Completed - the Aquifer Protection Permit was received on August 29, 2024 from the ADEQ following a robust process that included detailed analysis by the agency and Hudbay, along with a public comment period that was completed in the second quarter of 2024.

• Air Quality Permit - On Track - the Air Quality Permit application was submitted to the ADEQ in late 2022 and follows a similar robust process, including a public comment period that concluded in September 2024.

With the receipt of the Aquifer Protection Permit on August 29, 2024, Hudbay announced that it commenced activities related to the preparation of feasibility studies for Copper World, resulting in an expected $25 million increase in growth capital spending in Arizona, compared to the original annual guidance of $20 million.

Hudbay intends to commence a minority joint venture partner process after receiving the Air Quality Permit. The potential joint venture partner is anticipated to participate in the funding of definitive feasibility study activities in 2025 as well as in the final project design and construction for Copper World.

The opportunity to sanction Copper World is not expected until 2026 based on current estimated timelines. Once in production, Copper World is expected to be a meaningful copper producer in the U.S. domestic copper supply chain, which will be required to help secure growing U.S. metal demand related to increased manufacturing capacity, infrastructure development, increased energy independence and domestic battery supply chain and production needs. The "Made-in-America" copper cathode anticipated to be produced at Copper World is expected to be sold entirely to domestic U.S. customers and would make Copper World the third largest cathode producer in the U.S. Hudbay is pleased with the level of local support received at the public comment meetings and looks forward to providing significant social and environmental benefits for the community and local economy in Arizona. Over the proposed initial 20-year mine life, the company expects to contribute more than $850 million in U.S. taxes, including approximately $170 million in taxes to the state of Arizona. Hudbay also expects Copper World to create more than 400 direct jobs and up to 3,000 indirect jobs in Arizona.

Copper Mountain Stabilization Complete and Optimization Initiatives Underway

Stabilization Phase Completed

Since acquiring Copper Mountain in June 2023, Hudbay's stabilization efforts have been focused on ramping up the mining fleet to execute a planned accelerated stripping campaign to gain access to higher grades, as well as plant improvement initiatives to improve mill reliability and recoveries.

  • Mine Ramp-up Activities Completed - Successfully remobilized all 28 haul trucks and added five additional haul trucks this year to execute the planned three-year accelerated stripping campaign at a lower cost and avoid contractor mining costs.
  • Mill Stabilization Activities Completed - Implemented several mill initiatives, including reprogramming the mill expert system, installing advanced grinding control instrumentation, flotation operational strategy improvements and improved maintenance practices. This has resulted in record mill availability of 95% and record copper recovery of 84% being achieved in the third quarter of 2024.
  • Operating Costs Stabilized - Achieved sequential quarterly improvements in unit operating costs and cash costs this year with the third quarter of 2024 being the lowest cost quarter at Copper Mountain since Hudbay's acquisition in June 2023.
  • Corporate Synergies Target Achieved - Exceeded the targeted $10 million in annualized corporate synergies.
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Optimization Phase Underway

Efforts are now focused on several optimization initiatives at Copper Mountain to access higher grades, further improve mill throughput and increase copper production and operating cash flows.

• Accelerated Stripping - Commenced a three-year accelerated stripping program to mitigate the substantially reduced stripping that occurred over the four years prior to Hudbay's acquisition. The stripping program is intended to unlock access to higher grade ore and further benefit operating costs.

• Mill Throughput Optimization - Advancing various engineering studies to increase mill throughput to its permitted levels of 50,000 tonnes per day earlier than was originally contemplated in the technical report, including the potential conversion of the third ball mill to a SAG mill to alleviate capacity limitations.

• On Track to Achieve Three-Year Operating Efficiencies Target - Stabilization initiatives have resulted in improved operating efficiencies, as demonstrated by improved mill throughput, record copper recoveries and lower unit operating costs since Hudbay's acquisition. On track to realize the three-year annual operating efficiencies target of $20 million.

New Britannia Mill Performance Exceeding Expectations and Driving Higher Gold Production

The New Britannia mill has been consistently exceeding performance expectations, achieving throughput levels of 1,650 tonnes per day in 2023, more than 1,850 tonnes per day in the first half of 2024, and reaching a quarterly record of 2,080 tonnes per day in the third quarter of 2024. Hudbay completed the brownfield investment in New Britannia in 2021 and refurbished the mill with a nominal capacity of 1,500 tonnes per day to provide additional processing capacity at the Snow Lake operations and allow the company to achieve higher gold recoveries of approximately 90% as Lalor transitioned to the higher gold and copper areas of the mine plan. The Snow Lake operations achieved record quarterly gold production in the third quarter of 2024, and Hudbay now expects gold production in Manitoba to exceed the top end of the 2024 gold production guidance range of 200,000 ounces.

In August 2024, the company completed the final payment under the New Britannia gold prepay facility, which further enhances the company's exposure to higher gold production in Snow Lake. With approximately two million ounces of contained gold in current mineral reserve estimates and another 1.4 million ounces of contained gold in inferred mineral resources, the New Britannia investment has unlocked significant value in Snow Lake. This could be further enhanced by regional exploration upside and the current strong gold price environment.

In the first quarter of 2024, Hudbay received a permit approval to increase the production rate at New Britannia to 2,500 tonnes per day, which will provide the opportunity to process more Lalor ore at the New Britannia mill and create additional processing capacity at Stall for potential new regional discoveries in Snow Lake.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Exploration Update

Large Exploration Drill Program Continues in Snow Lake

Hudbay continues to execute its 2024 exploration program with the goal of extending known mineralization near the Lalor deposit to further extend mine life as well as to find a new anchor deposit within trucking distance of the Snow Lake processing infrastructure. The 2024 program included the largest geophysical program in the company's history in Snow Lake, with surface electromagnetic surveys detecting targets at more than 1,000 metres below surface and covering a 25-square-kilometre area including the Cook Lake claims that had been previously untested by modern deep geophysics.

The company had eight drill rigs turning in Snow Lake during the third quarter, including two drills completing follow-up drilling at Lalor Northwest, located within 400 metres of the existing Lalor underground infrastructure. Six drill rigs were testing new geophysical targets and completing follow-up drilling at potential regional satellite deposits at the Cook Lake, Reed, Rail and Bur properties. One of the geophysical targets is a very strong deep anomaly located at Cook Lake North, approximately six kilometres from Lalor. Drilling activities are expected to continue throughout the winter season and assay results are pending.

Hudbay continues to advance the development of the exploration drift from the existing Lalor ramp towards the 1901 deposit, and the drift is expected to reach mineralization in early 2025. The company plans to conduct definition drilling in 2025 to confirm the optimal mining method, evaluate the orebody geometry and continuity, and convert inferred mineral resources in the gold lenses to mineral reserves. In October, Hudbay initiated the development of an adjacent haulage drift to further de-risk future full production from the 1901 deposit in 2027.

Advancing Engineering Work for Flin Flon Tailings Reprocessing

  • Zinc Plant Tailings - Metallurgical test work continues following positive results from the initial confirmatory drill program completed earlier this year in the section of the tailings facility that was utilized by the zinc plant for 25 years. The results confirmed the grades of precious metals and critical minerals previously estimated from historical zinc plant records. An early economic study to evaluate the opportunity to reprocess the zinc plant tailings has confirmed the potential for a technically viable reprocessing alternative, and further engineering work is underway.

  • Mill Tailings **** - The company continues to advance metallurgical test work on the opportunity to reprocess Flin Flon mill tailings where 100 million tonnes of tailings were deposited for over 90 years. An early economic study on the mill tailings is planned.

Maria Reyna and Caballito Drill Permits Expected in 2025

Hudbay controls a large, contiguous block of mineral rights with the potential to host mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The company commenced early exploration activities at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment applications were submitted for the Maria Reyna property in November 2023 and for the Caballito property in April 2024. The environmental impact assessment (EIA) for Maria Reyna was approved by the government in June 2024 and the Caballito EIA was approved in September 2024. This represents one of several steps in the drill permitting process, which is expected to be completed in 2025.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Website Links

Hudbay:

www.hudbayminerals.com

Management's Discussion and Analysis:

https://www.hudbayminerals.com/MDA1124

Financial Statements:

https://www.hudbayminerals.com/FS1124

Conference Call and Webcast

Date: Wednesday, November 13, 2024
Time: 11:00 a.m. ET
Webcast: www.hudbay.com
Dial in: 1-844-763-8274 or 647-484-8814

Qualified Person and NI 43-101

The technical and scientific information in this news release related to the company's material mineral projects has been approved by Olivier Tavchandjian, P. Geo, Senior Vice President, Exploration and Technical Services. Mr. Tavchandjian is a qualified person pursuant to National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").

For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for the company's material properties as filed by Hudbay on SEDAR+ at www.sedarplus.ca and EDGAR at www.sec.gov.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Non-IFRS Financial Performance Measures

Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, net debt, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit costs and ratios based on these measures are non-IFRS performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of operating gross profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently.

Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the company believes these measures are useful to investors in assessing the company's underlying performance. Hudbay provides adjusted EBITDA to help users analyze the company's results and to provide additional information about its ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the company to assess its financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the company to assess its financial leverage and debt capacity. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because the company believes they help investors and management assess the performance of its operations, including the margin generated by the operations and the company. Cash cost and sustaining cash cost per ounce of gold produced are shown because the company believes they help investors and management assess the performance of its Manitoba operations. Combined unit cost is shown because Hudbay believes it helps investors and management assess the company's cost structure and margins that are not impacted by variability in by-product commodity prices.

The following tables provide detailed reconciliations to the most comparable IFRS measures.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Adjusted Net Earnings (Loss) Attributable to Owners Reconciliation

Three Months Ended
(in $ millions) Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Net earnings for the period 50.4 (20.4) 45.5
Tax expense 29.3 20.8 38.7
Earnings before tax 79.7 0.4 84.2
Adjusting items: ****
Mark-to-market adjustments^1^ 5.2 19.5 1.3
Foreign exchange loss (3.3) 2.1 (0.6)
Re-evaluation adjustment - environmental provision^2^ 2.0 (2.7) (32.4)
Inventory adjustments 1.6 - -
Acquisition related costs - - 0.1
Reduction of obligation to renounce flow-through expenditures (2.0) (0.3) -
Restructuring charges - 0.3 2.3
Write-down/loss on disposal of PP&E 2.2 2.1 -
Adjusted earnings before income taxes 85.4 21.4 54.9
Tax expense (29.3) (20.8) (38.7)
Tax impact on adjusting items (5.2) (2.4) 8.2
Adjusted net earnings 50.9 (1.8) 24.4
Adjusted net earnings attributable to non-controlling interest: ****
Net loss for the period (0.6) 3.8 (0.4)
Adjusting items, including tax impact - (1.9) 0.2
Adjusted net earnings - attributable to owners 50.3 0.1 24.2
Adjusted net earnings ($/share) - attributable to owners 0.13 0.00 0.07
Basic weighted average number of common shares outstanding (millions) 393.6 368.3 346.7

^1^ Includes changes in fair value of the gold prepayment liability, Canadian junior mining investments, other financial assets and liabilities at fair value through net earnings or loss and share-based compensation expenses.^^^^

^2^ Changes from movements to environmental reclamation provisions are primarily related to the Flin Flon operations, which were fully depreciated as of June 30, 2022, as well as other Manitoba non-operating sites.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Adjusted EBITDA Reconciliation

Three Months Ended
(in $ millions) Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Net (loss) earnings for the period 50.4 (20.4) 45.5
Add back: ****
Tax expense (recovery) 29.3 20.8 38.7
Net finance expense 26.0 44.3 30.9
Other expenses 7.9 11.2 8.9
Depreciation and amortization 97.5 97.6 113.8
Amortization of deferred revenue and variable consideration adjustment (9.5) (11.5) (16.8)
Adjusting items (pre-tax):
Re-evaluation adjustment - environmental provision 2.0 (2.7) (32.4)
Inventory adjustments 1.6 - -
Realized loss on non-QP hedges (2.1) (2.6) -
Share-based compensation expenses ^1^ 3.1 8.3 2.1
Adjusted EBITDA 206.2 145.0 190.7

^1^ Share-based compensation expenses reflected in cost of sales and selling and administrative expenses.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Net Debt Reconciliation

(in thousands) Jun. 30, 2024 Dec. 31, 2023
Total long-term debt 1,155,575 1,287,536
Less: Cash and cash equivalents (483,767) (249,794)
Less: Short-term investments (40,000) -
Net debt 631,808 1,037,742
(in millions, except net debt to adjusted EBITDA ratio)
Net debt 631.8 1,037.7
Adjusted EBITDA (12-month period) 824.3 647.8
Net debt to adjusted EBITDA 0.8 1.6

All values are in US Dollars.

Trailing Adjusted EBITDA Three Months Ended
(in $ millions) Sep. 30,2024 Jun. 30,<br>2024 Mar. 31,<br>2024 Dec. 31,<br>2023 Sept. 30,<br>2023 Jun. 30,<br>2023
Net earnings (loss) for the period 50.4 (20.4) 18.5 33.5 45.5 (14.9)
Add back:
Tax expense (recovery) 29.3 20.8 49.3 47.5 38.7 (15.8)
Net finance expense 26.0 44.3 44.0 48.9 30.9 30.5
Other expenses 7.9 11.2 16.3 10.6 8.9 13.9
Depreciation and amortization 97.5 97.6 109.3 121.9 113.8 88.7
Amortization of deferred revenue and variable consideration adjustment (9.5) (11.5) (23.2) (26.5) (16.8) (18.1)
Adjusting items (pre-tax): **** ****
Re-evaluation adjustment - environmental provision 2.0 (2.7) (5.3) 34.0 (32.4) (4.7)
Inventory adjustments 1.6 - - 1.4 - 0.9
Realized loss on non-QP hedges (2.1) (2.6) - - - -
Post-employment plan curtailment - - (0.4) - - -
Share-based compensation expenses^2^ 3.1 8.3 5.7 3.1 2.1 0.7
Adjusted EBITDA 206.2 145.0 214.2 274.4 190.7 81.2
LTM^1,3^ 839.8 824.3 760.5 647.8 **** ****

^1^LTM (last twelve months) as of September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023.

^2^Share-based compensation expense reflected in cost of sales and administrative expenses.

^3^ Annual consolidated results may not be calculated based on amounts presented in this table due to rounding.

Copper Cash Cost Reconciliation

Consolidated Three Months Ended
Net pounds of copper produced^1^
(in thousands) Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Peru 46,782 42,366 64,112
British Columbia 14,850 14,813 20,510
Manitoba 7,491 5,825 7,893
Net pounds of copper produced 69,123 63,004 92,515

^1^Contained copper in concentrate.

TSX, NYSE - HBM<br><br> <br>2024 No. 17
Consolidated Three Months Ended
--- --- --- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb
Mining 90,679 1.31 93,049 1.47 104,547 1.13
Milling 85,145 1.23 88,065 1.40 88,021 0.95
G&A 38,016 0.55 35,240 0.56 36,107 0.39
Onsite costs 213,840 3.09 216,354 3.43 228,675 2.47
Treatment & refining 21,202 0.31 22,562 0.36 32,882 0.36
Freight & other 24,415 0.35 21,728 0.34 26,853 0.29
Cash cost, before by-product credits 259,457 3.75 260,644 4.13 288,410 3.12
By-product credits (246,724) (3.57) (188,671) (2.99) (187,023) (2.02)
Cash cost, net of by-product credits 12,733 0.18 71,973 1.14 101,387 1.10
Consolidated Three Months Ended
--- --- --- --- --- --- ---
****** Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $000s $/lb^1^ $000s $/lb^1^ $000s $/lb^1^
By-product credits^2^: ****** ****** ****** ****** ****** ******
Zinc 24,326 0.35 14,916 0.23 17,099 0.18
Gold 188,957 2.73 136,189 2.16 129,954 1.41
Silver 18,347 0.27 18,088 0.29 16,724 0.18
Molybdenum & other 15,094 0.22 19,478 0.31 23,246 0.25
Total by-product credits 246,724 3.57 188,671 2.99 187,023 2.02
Reconciliation to IFRS: ****** ****** ****** ******
Cash cost, net of by-product credits 12,733 ****** 71,973 101,387 ******
By-product credits 246,724 ****** 188,671 187,023 ******
Treatment and refining charges (21,202) ****** (22,562) (32,882) ******
Share-based compensation expense 322 ****** 613 149 ******
Inventory adjustments 1,598 ****** - - ******
Past service pension costs 2,786 ****** - - ******
Change in product inventory 1,828 ****** 9,982 3,374 ******
Royalties 3,746 ****** 1,570 1,253 ******
Depreciation and amortization^3^ 97,452 ****** 97,646 113,753 ******
Cost of sales^4^ 345,987 347,893 374,057 ******

^1^Per pound of copper produced.

^2^By-product credits are computed as revenue per consolidated financial statements, amortization of deferred revenue and pricing and volume adjustments.

^3^ Depreciation is based on concentrate sold.

^4^As per consolidated interim financial statements.

TSX, NYSE - HBM<br><br> <br>2024 No. 17
Peru Three Months Ended
--- --- --- ---
(in thousands) Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Net pounds of copper produced^1^ 46,782 42,366 64,112

^1^Contained copper in concentrate.

Peru Three Months Ended
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb
Mining 37,647 0.81 31,306 0.74 33,875 0.53
Milling 48,535 1.04 51,335 1.21 46,996 0.73
G&A 19,830 0.42 19,349 0.46 20,912 0.33
Onsite costs 106,012 2.27 101,990 2.41 101,783 1.59
Treatment & refining 11,366 0.24 11,081 0.26 19,143 0.30
Freight & other 14,130 0.30 12,593 0.30 17,040 0.26
Cash cost, before by-product credits 131,508 2.81 125,664 2.97 137,966 2.15
By-product credits (47,245) (1.01) (50,251) (1.19) (84,793) (1.32)
Cash cost, net of by-product credits 84,263 1.80 75,413 1.78 53,173 0.83
Peru Three Months Ended
--- --- --- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $000s $/lb^1^ $000s $/lb^1^ $000s $/lb^1^
By-product credits^2^:
Gold^3^ 22,945 0.49 21,550 0.51 51,459 0.80
Silver^3^ 9,214 0.20 9,704 0.23 10,088 0.16
Molybdenum 15,086 0.32 18,997 0.45 23,246 0.36
Total by-product credits 47,245 1.01 50,251 1.19 84,793 1.32
Reconciliation to IFRS:
Cash cost, net of by-product credits 84,263 75,413 53,173
By-product credits 47,245 50,251 84,793
Treatment and refining charges (11,366) (11,081) (19,143)
Inventory adjustments 206 - -
Share-based compensation expenses 98 199 45
Change in product inventory 1,133 1,101 4,137
Royalties 2,117 929 1,015
Depreciation and amortization^4^ 57,242 58,860 80,625
Cost of sales^5^ 180,938 175,672 204,645

^1^Per pound of copper produced.

^2^By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments.

^3^Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements.

^4^Depreciation is based on concentrate sold.

^5^As per IFRS consolidated interim financial statements.

TSX, NYSE - HBM<br><br> <br>2024 No. 17
British Columbia Three Months Ended
--- --- --- ---
(in thousands) Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Net pounds of copper produced^1^ 14,850 14,813 20,510

^1^ Contained copper in concentrate.

British Columbia Three Months Ended
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb
Mining 12,918 0.87 19,463 1.31 29,251 1.43
Milling 19,707 1.33 21,508 1.45 24,102 1.17
G&A 5,788 0.39 5,442 0.37 5,050 0.25
Onsite costs 38,413 2.59 46,413 3.13 58,403 2.85
Treatment & refining 3,307 0.22 4,199 0.29 4,905 0.24
Freight & other 3,002 0.20 3,461 0.23 3,693 0.18
Cash cost, before by-product credits 44,722 3.01 54,073 3.65 67,001 3.27
By-product credits (17,891) (1.20) (14,523) (0.98) (12,234) (0.60)
Cash cost, net of by-product credits 26,831 1.81 39,550 2.67 54,767 2.67
British Columbia Three Months Ended
--- --- --- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $000s $/lb^1^ $000s $/lb^1^ $000s $/lb^1^
By-product credits^2^:
Gold 16,259 1.09 12,204 0.82 10,120 0.50
Silver 1,632 0.11 2,319 0.16 2,114 0.10
Total by-product credits 17,891 1.20 14,523 0.98 12,234 0.60
Reconciliation to IFRS:
Cash cost, net of by-product credits 26,831 39,550 54,767
By-product credits 17,891 14,523 12,234
Treatment and refining charges (3,307) (4,199) (4,905)
Change in product inventory (550) 11,290 3
Royalties 1,629 641 237
Depreciation and amortization^3^ 12,548 14,042 6,255
Cost of sales^4^ 55,042 75,847 68,591

^1^ Per pound of copper produced.

^2^ By-product credits are computed as revenue per consolidated financial statements, including pricing and volume adjustments.

^3^ Depreciation is based on concentrate sold.

^4^ As per consolidated interim financial statements.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

Sustaining and All-in Sustaining Cash Cost Reconciliation

Consolidated Three Months Ended
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
All-in sustaining cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb
Cash cost, net of by-product credits 12,733 0.18 71,973 1.14 101,387 1.10
Cash sustaining capital expenditures 101,610 1.47 92,973 1.48 72,193 0.78
Capitalized exploration - - 300 0.00 - -
Royalties 3,746 0.06 1,570 0.03 1,253 0.01
Sustaining cash cost, net of by-product credits 118,089 1.71 166,816 2.65 174,833 1.89
Corporate selling and administrative expenses & regional costs 12,843 0.18 19,771 0.32 10,971 0.12
Accretion and amortization of decommissioning and community agreements^1^ 3,935 0.06 6,544 0.10 3,309 0.03
All-in sustaining cash cost, net of by-product credits 134,867 1.95 193,131 3.07 189,113 2.04
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions 76,708 75,223 77,454
Capitalized stripping net additions 49,304 43,374 21,762
Total accrued capital additions 126,012 118,597 99,216
Less other non-sustaining capital costs^2^ 36,599 37,665 37,968
Total sustaining capital costs 89,413 80,932 61,248
Capitalized lease and equipment financing payments 10,234 9,575 7,199
Community agreement cash payments 312 678 1,953
Accretion and amortization of decommissioning and restoration obligations^3^ 1,651 1,788 1,793
Cash sustaining capital expenditures 101,610 92,973 72,193

^1^Includes accretion of decommissioning relating to non-productive sites, and accretion and amortization of current community agreements.

^2^Other non-sustaining capital costs include Arizona capitalized costs, capitalized interest, capitalized exploration and growth capital expenditures

^3^Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

TSX, NYSE - HBM<br><br> <br>2024 No. 17
Peru Three Months Ended
--- --- --- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Sustaining cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb
Cash cost, net of by-product credits 84,263 1.80 75,413 1.78 53,173 0.83
Cash sustaining capital expenditures 43,710 0.93 33,801 0.80 42,607 0.66
Capitalized exploration^1^ - - 300 0.01 - -
Royalties 2,117 0.05 929 0.02 1,015 0.02
Sustaining cash cost per pound of copper produced 130,090 2.78 110,443 2.61 96,795 1.51
^1^Only includes exploration costs incurred for locations near to existing mine operations.
---
British Columbia Three Months Ended
--- --- --- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Sustaining cash cost per pound of copper produced $000s $/lb $000s $/lb $000s $/lb
Cash cost, net of by-product credits 26,831 1.81 39,550 2.67 54,767 2.67
Cash sustaining capital expenditures 46,612 3.14 42,109 2.84 14,487 0.71
Royalties 1,629 0.11 641 0.05 237 0.01
Sustaining cash cost per pound of copper produced 75,072 5.06 82,300 5.56 69,491 3.39

Gold Cash Cost and Sustaining Cash Cost Reconciliation

Manitoba Three Months Ended
(in thousands) Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Net ounces of gold produced^1^ 62,468 43,488 56,213

^1^Contained gold in concentrate and doré.

Manitoba Three Months Ended
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Cash cost per ounce of gold produced $000s $/oz $000s $/oz $000s $/oz
Mining 40,114 642 42,280 973 41,421 737
Milling 16,903 271 15,222 350 16,923 301
G&A 12,398 198 10,449 240 10,145 180
Onsite costs 69,415 1,111 67,951 1,563 68,489 1,218
Treatment & refining 6,529 104 7,282 167 8,834 157
Freight & other 7,283 117 5,674 130 6,120 109
Cash cost, before by-product credits 83,227 1,332 80,907 1,860 83,443 1,484
By-product credits (59,987) (960) (47,386) (1,090) (45,779) (814)
Gold cash cost, net of by-product credits 23,240 372 33,521 771 37,664 670
TSX, NYSE - HBM<br><br> <br>2024 No. 17
---
Manitoba Three Months Ended
--- --- --- --- --- --- ---
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Supplementary cash cost information $000s $/oz^1^ $000s $/oz^1^ $000s $/oz^1^
By-product credits^2^:
Copper 28,152 451 25,932 596 24,158 430
Zinc 24,326 389 14,916 343 17,099 304
Silver 7,501 120 6,065 140 4,522 80
Other 8 - 473 11 - -
Total by-product credits 59,987 960 47,386 1,090 45,779 814
Reconciliation to IFRS:
Cash cost, net of by-product credits 23,240 33,521 37,664
By-product credits 59,987 47,386 45,779
Treatment and refining charges (6,529) (7,282) (8,834)
Inventory adjustments 1,392 - -
Share-based compensation expenses 224 414 104
Past service pension costs 2,786 - -
Change in product inventory 1,245 (2,409) (766)
Royalties - - 1
Depreciation and amortization^3^ 27,662 24,744 26,873
Cost of sales^4^ 110,007 96,374 100,821

^1^Per ounce of gold produced.

^2^By-product credits are computed as revenue per consolidated interim financial statements, amortization of deferred revenue and pricing and volume adjustments.

^3^Depreciation is based on concentrate sold.

^4^ As per IFRS consolidated interim financial statements.

Manitoba Three Months Ended
Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Sustaining cash cost per pound of gold produced $000s $/oz $000s $/oz $000s $/oz
Gold cash cost, net of by-product credits 23,240 372 33,521 771 37,664 670
Cash sustaining capital expenditures 11,289 181 17,063 392 15,100 269
Royalties - - - - 1 -
Sustaining cash cost per pound of gold produced 34,529 553 50,584 1,163 52,765 939
TSX, NYSE - HBM<br><br> <br>2024 No. 17
---

Combined Unit Cost Reconciliation

Peru Three Months Ended
(in thousands except ore tonnes milled and unit cost per tonne)
Combined unit cost per tonne processed Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Mining 37,647 31,306 33,875
Milling 48,535 51,335 46,996
G&A^1^ 19,830 19,349 20,912
Other G&A^2^ (1,993) (4,113) (5,440)
Unit cost 104,019 97,877 96,343
Tonnes ore milled 8,137 7,719 7,895
Combined unit cost per tonne 12.78 12.68 12.20
Reconciliation to IFRS: ****
Unit cost 104,019 97,877 96,343
Freight & other 14,130 12,593 17,040
Inventory adjustments 206 - -
Other G&A 1,993 4,113 5,440
Share-based compensation expenses 98 199 45
Change in product inventory 1,133 1,101 4,137
Royalties 2,117 929 1,015
Depreciation and amortization 57,242 58,860 80,625
Cost of sales^3^ 180,938 175,672 204,645

^1^G&A as per cash cost reconciliation above.

^2^Other G&A primarily includes profit sharing costs.

^3^As per IFRS consolidated interim financial statements.

Manitoba Three Months Ended
(in thousands except tonnes ore milled and unit cost per tonne)
Combined unit cost per tonne processed Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Mining 40,114 42,280 41,421
Milling 16,903 15,222 16,923
G&A^1^ 12,398 10,449 10,145
Less: Other G&A related to profit sharing costs (5,385) (3,428) (3,308)
Unit cost 64,030 64,523 65,181
USD/CAD implicit exchange rate 1.36 1.38 1.34
Unit cost - C$ 87,391 89,336 87,363
Tonnes ore milled 413,919 397,426 402,443
Combined unit cost per tonne - C$ 211 225 217
Reconciliation to IFRS: ****
Unit cost 64,030 64,523 65,181
Freight & other 7,283 5,674 6,120
Other G&A related to profit sharing 5,385 3,428 3,308
Share-based compensation expenses 224 414 104
Inventory adjustments 1,392 - -
Past service pension costs 2,786 - -
Change in product inventory 1,245 (2,409) (766)
Royalties - - 1
Depreciation and amortization 27,662 24,744 26,873
Cost of sales^2^ 110,007 96,374 100,821

^1^G&A as per cash cost reconciliation above.

^2^As per IFRS consolidated interim financial statements.

TSX, NYSE - HBM<br><br> <br>2024 No. 17
British Columbia Three Months Ended
--- --- --- ---
(in thousands except unit cost per tonne)
Combined unit cost per tonne processed Sep. 30, 2024 Jun. 30, 2024 Sep. 30, 2023
Mining 12,918 19,463 29,251
Milling 19,707 21,508 24,102
G&A^1^ 5,788 5,442 5,050
Unit cost 38,413 46,413 58,403
USD/CAD implicit exchange rate 1.35 1.36 1.35
Unit cost - C$ 52,388 63,522 78,566
Tonnes ore milled 3,363 3,232 3,158
Combined unit cost per tonne 15.58 19.65 24.88
Reconciliation to IFRS: ****
Unit cost 38,413 46,413 58,403
Freight & other 3,002 3,461 3,693
Change in product inventory (550) 11,290 3
Royalties 1,629 641 237
Depreciation and amortization 12,548 14,042 6,255
Cost of sales^2^ 55,042 75,847 68,591

^1^G&A as per cash cost reconciliation above ^2^ As per consolidated interim financial statements.

Forward-Looking Information

This news release contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "budget", "guidance", "scheduled", "estimates", "forecasts", "strategy", "target", "intends", "objective", "goal", "understands", "anticipates" and "believes" (and variations of these or similar words) and statements that certain actions, events or results "may", "could", "would", "should", "might" "occur" or "be achieved" or "will be taken" (and variations of these or similar expressions). All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information includes, but is not limited to, statements with respect to the company's production, cost and capital and exploration expenditure guidance, the ability of the company to optimize the Copper Mountain mine operation, the implementation of stripping strategies and the expected benefits therefrom, the estimated timelines and pre-requisites for sanctioning the Copper World project and the pursuit of a potential minority joint venture partner, expectations regarding the permitting requirements for the Copper World project (including expected timing for receipt of the Air Quality Permit), the expected benefits of the sanctioning of the Copper World project, the expected benefits of Manitoba growth initiatives, including the exploration drift at the 1901 deposit, the company's future deleveraging strategies and the company's ability to deleverage and repay debt as needed, expectations regarding the company's cash balance and liquidity, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, including the advancement of the exploration program at Maria Reyna and Caballito and the status of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, the ability to continue mining higher-grade ore in the Pampacancha pit and the company's expectations resulting therefrom, expectations regarding the ability for the company to further reduce greenhouse gas emissions, the company's evaluation and assessment of opportunities to reprocess tailings using various metallurgical technologies, the anticipated impact of brownfield and greenfield growth projects on the company's performance, anticipated expansion opportunities and extension of mine life in Snow Lake and the ability for Hudbay to find a new anchor deposit near the company's Snow Lake operations, anticipated future drill programs and exploration activities and any results expected therefrom, anticipated mine plans, anticipated metals prices and the anticipated sensitivity of the company's financial performance to metals prices, events that may affect its operations and development projects, anticipated cash flows from operations and related liquidity requirements, the anticipated effect of external factors on revenue, such as commodity prices, estimation of mineral reserves and resources, mine life projections, reclamation costs, economic outlook, government regulation of mining operations, and business and acquisition strategies. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by the company at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

The material factors or assumptions that Hudbay has identified and were applied in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to:

  • the ability to achieve production, cost and capital and exploration expenditure guidance;
  • no significant interruptions to operations due to social or political unrest in the regions Hudbay operates, including the navigation of the complex political and social environment in Peru;
  • no interruptions to the company's plans for advancing the Copper World project, including with respect to timely receipt of the Air Quality Permit and the pursuit of a potential joint venture partner;
  • the ability for the company to successfully complete the optimization of the Copper Mountain operations, obtain required permits and develop and maintain good relations with key stakeholders;
  • the ability to execute on its exploration plans and to advance related drill plans;
  • the ability to advance the exploration program at Maria Reyna and Caballito;
  • the success of mining, processing, exploration and development activities;
  • the scheduled maintenance and availability of the company's processing facilities;
  • the accuracy of geological, mining and metallurgical estimates;
  • anticipated metals prices and the costs of production;
  • the supply and demand for metals the company produces;
  • the supply and availability of all forms of energy and fuels at reasonable prices;
  • no significant unanticipated operational or technical difficulties;
  • no significant interruptions to operations due to adverse effects from extreme weather events, including but not limited to forest fires that may affect the regions in which the company operates;
  • the execution of the company's business and growth strategies, including the success of its strategic investments and initiatives;
  • the availability of additional financing, if needed;
  • the company's ability to deleverage and repay debt, as needed;
  • the ability to complete project targets on time and on budget and other events that may affect the company's ability to develop its projects;
  • the timing and receipt of various regulatory and governmental approvals;
  • the availability of personnel for the company's exploration, development and operational projects and ongoing employee relations;
  • maintaining good relations with the employees at the company's operations;
  • maintaining good relations with the labour unions that represent certain of the company's employees in Manitoba and Peru;
  • maintaining good relations with the communities in which the company operates, including the neighbouring Indigenous communities and local governments;
  • no significant unanticipated challenges with stakeholders at the company's various projects;
  • no significant unanticipated events or changes relating to regulatory, environmental, health and safety matters;
TSX, NYSE - HBM<br><br> <br>2024 No. 17
  • no contests over title to the company's properties, including as a result of rights or claimed rights of Indigenous peoples or challenges to the validity of the company's unpatented mining claims;
  • the timing and possible outcome of pending litigation and no significant unanticipated litigation;
  • certain tax matters, including, but not limited to current tax laws and regulations, changes in taxation policies and the refund of certain value added taxes from the Canadian and Peruvian governments; and
  • no significant and continuing adverse changes in general economic conditions or conditions in the financial markets (including commodity prices and foreign exchange rates).

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks related to the failure to effectively complete the optimization and expansion of the Copper Mountain mine operations, political and social risks in the regions Hudbay operates, including the navigation of the complex political and social environment in Peru, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, potential tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of the company's projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks related to the Copper World project, including in relation to permitting, project delivery and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, risks related to extreme weather events, including forest fires that may affect the regions in which the company operates and other severe storms, operational risks and hazards, including the cost of maintaining and upgrading the company's tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of the company's reserves, volatile financial markets and interest rates that may affect the company's ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, the company's ability to comply with its pension and other post-retirement obligations, the company's ability to abide by the covenants in its debt instruments and other material contracts, tax refunds, hedging transactions, as well as the risks discussed under the heading "Risk Factors" in the company's most recent Annual Information Form, which is available on the company's SEDAR+ profile at www.sedarplus.ca and the company's EDGAR profile at www.sec.gov.

Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. Hudbay does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

Note to United States Investors

This news release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers.

TSX, NYSE - HBM<br><br> <br>2024 No. 17

About Hudbay

Hudbay (TSX, NYSE: HBM) is a copper-focused mining company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining-friendly jurisdictions of Canada, Peru and the United States.

Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the company, which is complemented by meaningful gold production. Hudbay's growth pipeline includes the Copper World project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations.

The value Hudbay creates and the impact it has is embodied in its purpose statement: "We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities." Hudbay's mission is to create sustainable value and strong returns by leveraging its core strengths in community relations, focused exploration, mine development and efficient operations.

For further information, please contact:

Candace Brûlé

Vice President, Investor Relations

(416) 814-4387

[email protected]

___________________

^i^ Adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners; adjusted EBITDA; cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits; cash cost and sustaining cash cost per ounce of gold produced, net of by-product credits; combined unit costs, net debt and any ratios based on these measures are non-IFRS financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the "Non-IFRS Financial Performance Measures" section of this news release.

Hudbay Minerals Inc.: Exhibit 99.4 - Filed by newsfilecorp.com

FORM 52-109F2 CERTIFICATION OF INTERIM FILINGS FULL CERTIFICATE

I, Peter Kukielski, President and Chief Executive Officer of Hudbay Minerals Inc., certify the following:

  1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of Hudbay Minerals Inc. ****** (the "issuer") for the interim period ended September 30, 2024.

  2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

  3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

  4. Responsibility: The issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

  5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control framework: The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

5.2 N/A

5.3 N/A

  1. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on July 1, 2024 ****** and ended on September 30, 2024 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: November 13, 2024

(signed) "Peter Kukielski"

Peter Kukielski President and Chief Executive Officer

Hudbay Minerals Inc.: Exhibit 99.5 - Filed by newsfilecorp.com

FORM 52-109F2 CERTIFICATION OF INTERIM FILINGS FULL CERTIFICATE

I, Eugene Lei, Chief Financial Officer of Hudbay Minerals Inc., certify the following:

  1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of Hudbay Minerals Inc. ****** (the "issuer") for the interim period ended September 30, 2024.

  2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

  3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

  4. Responsibility: The issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

  5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control framework: The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

5.2 N/A

5.3 N/A

  1. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on July 1, 2024 ****** and ended on September 30, 2024 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: November 13, 2024

(signed) "Eugene Lei"

Eugene Lei Chief Financial Officer

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