Hello, ladies and gentlemen. Welcome to McEwen Mining's Q4 and Year-End 2023 Operating and Financial Results Conference Call. Present from the company today are Rob McEwen, Chairman and Chief Owner; Perry Ing, Chief Financial Officer; William Shaver, Chief Operating Officer; Stefan Spears, Vice President, Corporate Development; Michael Meding, Vice President and General Manager of McEwen Copper; Jeff Chan, Vice President, Finance; Carmen Diges, General Counsel and Secretary. After the speakers’ presentation, there will be a question-and-answer session. I will now turn the call over to Mr. Rob McEwen, Chief Owner. Please go ahead, sir.

Thank you, operator. Good morning, ladies and gentlemen, and welcome. I'm delighted to say we had a great year. Not only did our strategy to surface value of McEwen Copper and a very large copper project, Los Azules, deliver large gains, but also our gold and silver mines increased production, met guidance, and reduced their production cost per ounce closer to industry averages. In addition, our exploration efforts delivered solid gains at Los Azules and in our properties in Timmins. All of this allowed us to report a net income of $54.7 million or $1.15 per share, versus a net loss of $81.1 million or $1.71 in 2022. These big swings in our bottom line are largely due to our investment in McEwen Copper and its 100% ownership in our massive Los Azules property. Prior to last October, we owned more than 50% of McEwen Copper. As a result, McEwen Mining's financials represented the consolidation of McEwen Copper's financials. We have been spending hundreds of millions of dollars advancing the Los Azules project first to an updated preliminary economic assessment, which we released in June of last year. Now we're driving towards completing a bankable feasibility study in the first quarter of 2025. In October of last year, we completed our third financing of McEwen Copper. As a result of that, our ownership dropped below 50% to 48%, leading to us no longer consolidating the financials of McEwen Copper, generating a significant gain reflected in our financials. This was the strategy from the very beginning to surface value for McEwen Mining. Now the biggest aspect is I think we're trading at a substantial discount. Although we're trading around $6 a share, we have a management view that we're trading anywhere between $7 and $29 a share, indicating a lot of room on the upside. This is driven by our three sets of assets: McEwen Copper, which we own 48% of; a royalty portfolio; and our gold and silver assets. Values range from $8 to $30 a share, indicating we're trading at a significant discount for the upside. It's been a hard couple of years for us and our shareholders. From September '18 to the end of August '22, our share price was going in one direction, which was down, and I call that the road to hell. Right now, I'll call it we're on the road to redemption. If we compare our results against the price of gold, copper, the NASDAQ, and the Dow since September '22 when we did our first financing in McEwen Copper, McEwen Mining is up 107%, the NASDAQ is up 37%, Silver is up 27%, the Dow is up 23%, Gold is up 20%, GDX is up 14%, GDXJ is up 13%, and Copper is up 12%. We're clearly outperforming. I think we have two drivers: one is our copper, which I believe has long been considered a potential copper unicorn; the second is the turnaround in our gold and silver assets that are delivering positive cash flows and financing our exploration programs. We have exciting development programs in Timmins where we expect to put a ramp down and start production in '25 on a discovery made several years ago. Recent results from Stock West and Stock East yielded intriguing high grades. The importance of the stock mine is threefold: one, it's right beside our mill, eliminating transportation costs of about $10 a ton; two, it doesn’t have a royalty on it, saving about $1,500 an ounce that we have to give up; and three, the rock is softer, allowing us to process a higher volume of material through the mill, theoretically producing more gold and reducing costs. At Los Azules in McEwen Copper, we delivered a robust preliminary economic assessment in June. This project is significant, as when I assess non-gold resources in terms of gold equivalency, we see 37.6 billion pounds of copper, which translates into a gold equivalent deposit of 70 million ounces. The average production of 321 million pounds of copper per annum could yield about 600,000 ounces a year with cash costs at $1.07 a pound, equating to around $600 an ounce in gold equivalent terms. This reflects the immense value of Los Azules, which has a life of 27 years and potential for improvement. Our exploration in gold and silver assets has taken time, but we are moving in the right direction, with another project in Mexico slated for advancement later this year. Importantly, we need to shift public perception of mining towards a more responsible, environmentally sensitive model. At Los Azules, we've engaged a prominent architect in green building to redefine our approach. The aim is to create a future-focused mining operation that minimizes environmental impact, including lower CO2 emissions, reduced water usage, and renewable energy sources. This combination of factors will produce sustainable copper cathode for direct industry use, enhancing marketability. I’d now like to open it up for questions.

Your first question will come from the line of Heiko Ihle with H.C. Wainwright. Please go ahead.

Hey. Sorry, I was on mute. Hey, Rob, and team, thanks for taking my questions. Earlier on this call, you talked about the lower production costs. It's now officially March or two-thirds through Q1 at this point. How much more in these cost savings have you seen in Q1 thus far? And maybe if you could give a bit of a breakdown of where they derive from. I mean, obviously, you have your guidance in the release, but could you provide a bit more color with raw numbers?

I'll ask Bill to answer that question, Heiko.

Yeah. Thanks for the question, Heiko. The drivers of the costs are pretty fundamental in terms of labor cost, power cost exposures, and all of those factors that contribute to the cost. In 2024 and beyond, we need to produce more ounces to drive down monthly operating costs to improve overall operating costs and margins. We’re transitioning from mining, moving towards stock, which has a work index of between 21 and 23 to one between, say, 14 and 17. This will allow us to increase tonnes per day going through the plant. Most grades remain similar, which supports an increase in production from the current 50,000 ounces a year to 60,000 ounces. We also aim to enhance tonnage by adding capacity to our grinding circuit, so that's a short-term focus along with longer-term aspirations for reducing operating costs per tonne and per ounce.

Yeah. That was good. Thank you. Completely different question. You had a reasonably large flow-through financing in December of last year for CAD 22 million. How much of that have you already spent at Fox this year? And should we just assume that it's even by quarter?

Yeah. Of that total amount of money, approximately half of it is for CEE for drilling. If you divide that by something like 10 or 11, that will be the expenditures per month. The CEE is for infrastructure development at Stock, and we'll start spending on that at the beginning of the second quarter, spreading expenditures over the rest of the year, so that's likely around $1 million to $1.2 million a month.

Okay. I’ll get back in the queue. Thank you all.

Thanks, Heiko.

Your next question comes from the line of Joseph Reagor with ROTH Capital. Please go ahead.

Hey, Rob and Team.

Hey, Joe.

Thanks for taking my questions. I guess the first one is, since you had this large gain in Q4, can you just back that out and for apples-to-apples sake, what would the earnings have looked like in Q4?

Jeff, you.

Sure. We reported a net income for the year of $54.7 million. If you add back the accounting gain of $224 million, less the deferred tax accounting impacts of that of $37 million, removing those factors would normalize the earnings from that accounting.

Yeah, it's the taxes I needed there. Thanks for clarifying. Okay. And then as you think about 2024, other than issuing the copper, what are the big things you are looking at for growth this year and into next? Is it the Mexican assets? Is it developing Stock and drilling that out more? What should we be looking at?

Number one would be behind Los Azules, Timmins and the development of the Stock property, which will serve as the next source of production. There's ongoing exploration with a couple of recent press releases about increased resources at Stock and intriguing high grades at Stock East. Additionally, we’re drilling at Grey Fox where we have over 1 million ounces. We're evaluating possible expansions in adjacent areas complementary to our production base. Second would be Mexico.

Second would be Mexico. We need to complete the engineering, but the main driver is the permitting phase where we hope to have permits by mid-year. Permitting is always challenging, so timelines are unpredictable. We also plan to expand production at Gold Bar where we constructed a new leach pad last year, eliminating constraints on the area for material placement. This strategy aims to increase ore production at Gold Bar which will lead to an increase in total ounces produced there. So overall, we're focused on improving production across all operations this year and increasing tonnage into 2025.

Okay, that sounds good. One final thing, Rob, do you have any thoughts on the potential repeal of the new mining exploration law in Mexico and how it might impact you if it does get repealed?

We're just watching it. We have had some permits, but politics can be unpredictable, Joe. We’re proceeding with the assumption that the in-pit tailings disposal approval will continue. If it were to change, it may impact us six years later, since the first six years of reprocessing involves tailings, not heap leaching.

That’s correct.

So in the near term, we have time to see if the repeal happens.

Okay, thanks for your comments. I’ll turn it over.

Thank you.

Our next question will come from the line of John Tumazos with John Tumazos Very Independent Research. Please go ahead.

Good morning, John.

Good morning. Thank you. I'm looking ahead a year or so to after the definitive feasibility study is completed. What will be the path forward for McEwen Copper or the consensus of the board, such as McEwen Mining, Rio Tinto, Stellantis, etc.? Would the next step be to apply for permits or conduct early works for construction?

The feasibility study is expected in Q1 of next year. Following that, there will be about a year of engineering required before we decide to commence construction. We have assembled a capable team with substantial experience in building projects in San Juan province, where Los Azules is located. We’re confident in their ability to execute the build.

Hi, John. I'm glad to speak to you. We filed our environmental permit for construction and operation in April last year. We're currently having different meetings with various stakeholders and expect the environmental permit in the second half of 2024. As Rob mentioned, while undergoing detailed engineering, we will also obtain remaining permits. This will outline our path forward. We haven't made decisions yet on construction, but compared to other projects in the region, Los Azules should have high constructability with low CapEx, which should assist with financing and construction.

Thank you.

You’re welcome.

And there are no further questions at this time. Mr. Rob McEwen, I will turn the call back over to you.

Thank you, operator. I’d like to thank everyone for being on the line. I think that our future is looking much brighter than it looked several years ago. Hold on, we’re going higher. Thank you.

And everyone, that will conclude our call for today. Thank you all for joining. You may now disconnect.