Thank you for standing by. This is the conference operator. Welcome to the Pan American Silver Third Quarter 2025 Results Conference Call. The conference is being recorded. I would now like to turn the conference over to Siren Fisekci, Vice President, Investor Relations. Please go ahead, Ms. Fisekci.

Thank you for joining us today for Pan American Silver's conference call and webcast to discuss our third quarter 2025 results. This call includes forward-looking statements and information and references non-GAAP measures. Please see the cautionary statements in our MD&A, news release and presentation slides for the Q3 2025 results, all of which are available on our website. I'll now turn the call over to Michael Steinmann, Pan American's President and CEO.

Good morning, everyone. I'm glad you could join us to discuss Pan American's Q3 2025 results. Over the past quarter and into Q4, we have benefited from the increase in silver and gold prices and a solid performance on cost. As a result, we achieved record attributable free cash flow of $251.7 million in Q3. On September 4, we completed our acquisition of MAG Silver. While we have had only a 1-month contribution from our 44% interest in the Juanicipio mine in Mexico, we're already seeing the impact on lowering costs and improving margins, underscoring the strategic rationale for this transaction. We account for Juanicipio using the equity method, but report production, cash cost, all-in sustaining costs and capital expenditures on an attributable base to reflect our 44% interest. I'm pleased to say that we have delivered another quarter of strong financial results. Attributable revenue in Q3 was a record of $884.4 million. Net earnings were $169.2 million or $0.45 basic earnings per share. This includes a $21.7 million loss from the sale of a subsidiary and $16.3 million of income from Juanicipio. The loss from the sale of a subsidiary is primarily due to a $28.6 million reduction to the $137.4 million gain we had previously booked on December 2024 of the sale of La Arena related to net working capital adjustments. This was partially offset by a $6.8 million gain on the sale of our 80% interest in La Pepa, a noncore development stage project in Chile, which we've sold for $40 million in cash proceeds in September 2025. Adjusted earnings were $181 million or $0.48 basic adjusted earnings per share. Attributable cash flow from operations was a record of $323.6 million. Cash and short-term investments at the end of Q3 totaled $910.8 million, plus $85.8 million of cash at Juanicipio for our 44% interest. This is after spending a net of $409.3 million on the MAG acquisition, including transaction costs. With $1.7 billion of total available liquidity, we remain in a very strong financial position. Given the strong financial position and cash flow generation, I'm happy to report that the Board has approved an increase to the dividend to $0.14 per common share with respect to Q3 2025. Despite the cash balance at the end of the quarter, reflecting the impact of the cash paid for the MAG acquisition, the Board exercised its discretion regarding the dividend this quarter given the strong cash flow being generated. While we did not repurchase any shares in Q3 due in part to the blackout associated with the MAG acquisition, we remain prepared to act opportunistically. During the first 9 months of 2025, we have returned $146.9 million in dividends and share repurchases to shareholders, and we will add another $59.1 million with the dividend payment approved yesterday. Turning now to operations. Attributable silver production in Q3 was 5.5 million ounces, including 580,000 ounces from Juanicipio's 1-month contribution. We continue to be pleased by the performance at La Colorada, where the improved ventilation conditions are allowing mine rehabilitation and development rates to accelerate, thereby increasing the number of production areas, particularly in the deep high-grade zones of Candelaria East. Silver production was impacted by lower silver grades at Huaron, reflecting increased development and reduced stope ore mining rates in order to grow the inventory of prepared high-grade stopes, which are expected to enhance future production stability and reliability beginning in mid-2027. Silver segment cash costs were $10.41 per ounce and all-in sustaining costs were $15.43 per ounce. These costs are lower than Q2 2025, already demonstrating the positive impact Juanicipio is having on reducing silver costs and improving margins, even though it has only been in our portfolio since early September. The quarter also benefited from low all-in sustaining costs at Cerro Moro due to high by-product gold production and prices compared to Q2. Partially offsetting these factors was the lower silver production at Huaron and the royalty expense at La Colorada of $8.3 million in Q3, largely payable to a third party as part of a profit-sharing agreement for mining on an adjacent concession. Attributable gold production was 183,500 ounces. As we mentioned during our Q2 call, various technical issues at Cerro Moro, Peñon, Timmins and Minera Florida, as described in our MD&A, were expected to linger into Q3, consistent with our expectation of a back-end weighted gold production. The technical issues at Cerro Moro and El Peñon also reduced silver production in Q3. Gold segment cash costs were $1,325 per ounce and all-in sustaining costs, excluding NRV inventory adjustments, were $1,697 per ounce. Overall production and cost across both the silver and gold segments remain in line with our 2025 operating outlook. However, we have raised our attributable silver production guidance to 22 million to 22.5 million ounces and lowered Silver segment all-in sustaining costs to $14.50 to $16 per ounce to incorporate Juanicipio's contribution. All other cost and production guidance remain unchanged. We invested $35.3 million in capital projects this quarter, mainly at La Colorada and Jacobina. At La Colorada, we continued exploration and equipment investments to further expand access to high-grade zones in the deeper eastern extents of the Candelaria ore zone. In September, we announced new high-grade drill results and added 52.7 million ounces of silver to inferred mineral resource, which substantially extend resource potential to the East and Southeast beyond our current mining areas. This is an exciting development that offers significant synergies through a potential 2-phase development approach to our large La Colorada Skarn project. The first phase would combine development of the Skarn with the vein mine, which is expected to result in a higher grade, lower tonnage and less capital-intensive development than what was described in our 2024 PEA. The second phase would involve the cave mine expansion. This phased development approach allows an enhanced vein mine to operate in parallel, utilizing shared infrastructure synergies and enhancing overall project value. A PEA for this 2-phase development approach combined with enhanced vein mining is underway and is expected to be issued in Q2 2026. Furthermore, we are well advanced on partnership discussions that consider this enhanced development approach. At Jacobina, results from the extensive optimization study have identified a number of opportunities to relieve constraints that could potentially benefit mine life, production and operational efficiencies. These opportunities include, but are not limited to: a tailings filtration and filter stack project to relieve existing long-term tailings capacity limitations; mine paste backfill plant project to take advantage of the tailings filtration circuit, thereby enabling an increase in ore recovery in selective high-grade ore zones; and a significant process plant streamlining project to improve reliability, release throughput constraints, reduce mine operating costs and enhance gold recovery. We have recently commissioned a pilot plant on-site to demonstrate the benefits that can be obtained by streamlining a planned flow sheet, which has been defined through batch-scale metallurgical laboratory testing. We have also engaged a leading engineering firm to develop detailed designs, schedules and cost estimates for completing these optimization projects. We will continue to provide updates on implementing these exciting projects as these engineering efforts advance over the next year. At Escobal, the Guatemalan Ministry of Energy and Mines has held several separate working meetings with the ministries involved in the ILO 169 consultation process, representatives from the Xinka Parliament and the company. The Ministry of Mines has also made several appointments of key personnel to oversee and continue activities for the Escobal consultation process. The ministry has not provided a timeline for the completion of the ILO 169 consultation, but discussions remain active and respectful. Before closing, I would like to recognize Steve Busby for his remarkable contributions to Pan American Silver over the past 22 years, with 17 years spent as Chief Operating Officer. Steve is transitioning to the role of Special Adviser to the CEO, and I'm grateful we will continue to benefit from his deep technical expertise. I also want to welcome Scott Campbell as our new Chief Operating Officer. Scott brings 25 years of operational experience in Latin America, and I look forward to continuing to work closely with him as we advance our strategy. I will now be happy to take your questions together with the other members of our management team.

First question is from Wayne Lam with TD Securities.

Just curious on the guidance increase. Would it be safe to assume that the prior guidance for Juanicipio has remained the same as under MAG previously? And just wondering if there's been some modest tweaks for within the Silver segment on the guidance. Just given the deal closing in September, I would have thought the pro forma silver guide would have been slightly higher. So just wondering if there are any other offsets from the other operations in the portfolio?

No, it's quite comparable to what MAG had. As you can imagine, we are really only in the second month of operating since the acquisition. However, we expect that the production will be similar to what we experienced in September for the rest of the year.

Okay. Great. And then maybe at Huaron, just on the grades and the increase in the development ore being processed. It's been a couple of quarters now where you've encountered a bit higher dilution on the mining front. And just wondering if that maybe has also been a function of the reduction in the cutoff grade, just in terms of the process grades coming down a bit? And just curious if we should expect a bounce-back in grades over the coming quarters or if that's more of an active strategy that you guys are employing to lower the cutoffs to bring in a bit more economic material?

Wayne, this is Steve. I can address that one. Yes, the initiative we started last quarter was to accelerate developments, trying to get ahead, trying to get some high-grade stopes prepared and develop an inventory of stopes to give us more reliability on production. This initiative is going to take us through all of '26 into '27. And so what you're seeing is a lot more contribution of ore from development, which is more diluted than from stope mining. And it's really an initiative to try to build inventory of stopes in the mine that will give us more flexibility in the future once we get all this development ahead of ourselves. That's what you're seeing.

Okay. Great. And then maybe just last one, just at Jacobina on the optimization studies that are being undertaken. Can you give us a bit more detail on what's being optimized on the mine or at the plant and how that might impact the future operations, if that will be on additional tonnage or lower costs and when we might be able to see the results of that?

Yes, great question. And there's a lot of work going on at Jacobina. I'll pass it on to Steve. As you heard there, Steve will retire here as the COO, but he will stick around with us with his incredible wealth of knowledge. Steve will be very important for that kind of expansion work at Jacobina. So Steve, maybe if you want to answer that question?

Sure, I'd be happy to answer that, Wayne. It's very exciting what we're seeing at the mine. The mine is quite flexible as we are currently mining seven areas and will soon add an eighth with Maricota. This flexibility allows us to efficiently deliver ore to the plant in terms of throughput, tonnage, and other related aspects. Our main focus for optimization is the plant itself. This plant is quite old, originally built in the '80s as a less than 4,000 tonne per day facility. Over the years, many components and circuits have been added, resulting in a complex flow system. We see an opportunity to streamline the plant by removing unnecessary circuits, cleaning up the circuitry, and upgrading to larger, fewer machines to reduce maintenance costs, improve reliability, enhance efficiency, and lower overall costs. Looking long term at Jacobina, we see a potential to implement a filter stack tailings facility, which would greatly increase our disposal capacity. Conventional tailings are expected to run out of capacity by the mid-2030s, so introducing a filter plant into the flow sheet is vital. We are considering vacuum filters similar to those used at El Peñon, which seem promising. We plan to establish a vacuum filter plant at the tailings facility, allowing us to design a stack below the B2 dam. This location will also enable us to add a modular temporary paste plant using some of the tailings to create cemented paste. This can be pumped into the northern part of the mine to access higher-grade mining areas, improving recovery in regions we wouldn't be able to reach without cement backfill. This optimization is part of a significant brownfield project around the plant, which will require careful planning and sequencing. We are collaborating closely with an engineering company to finalize the designs, sequencing, and costs, so we can fully understand the value of this project. We are very excited about the potential ahead.

Okay. Great. That's a lot of good detail. And best of luck to you, Steve.

The next question is from Fahad Tariq with Jefferies.

Maybe just on the gold guidance, which didn't change. Can you talk about how you're thinking about the fourth quarter in the context of some of the dilution that you cited at Timmins, El Peñon, and some of the development delays you cited at Minera Florida? Just trying to get a sense of kind of the confidence in the fourth quarter on the gold side?

Yes. Scott Campbell here. We had our challenges certainly in Q3, but we're maintaining the guidance for Q4, and we're confident that, that will be achieved. We did have some dilution in Peñon, and we had some challenges and slight delays when it comes to ground support at both of our mines in Chile, but we're maintaining guidance and things in November have already started to look up for gold production in the southern countries.

Okay. And then maybe just switching gears to the updated development approach at La Colorada Skarn. Just in the opening remarks, you talked about the partnership discussions are well advanced. Maybe just any detail you can provide would be helpful.

The discussions about the partnership are progressing well, but it’s too early to share details publicly. We are quite excited about the new approach we've been considering for the high-grade portion of our Skarn ore bodies. Over the past couple of years, we’ve released several press statements showcasing impressive long and wide high-grade intercepts in two of the three Skarn ore bodies we have identified. Notably, we discovered high-grade structures in 2025 and announced an increase in our resources by approximately 53 million ounces in September. This combination of near-surface high-grade discoveries and wide intercepts allows us to pursue a phased development approach. We anticipate two phases; the first will involve smaller tonnages yet still yield impressive silver output, similar to our original plan but with higher grade, lower tonnage, and reduced capital expenditures. Eventually, we'll transition to a larger cave mine. We are eager to share more updates in the PEA scheduled for Q2 next year and look forward to finalizing strong partnership agreements for this exciting project.

Okay. Great. And then maybe just lastly, is it fair to say that the partner would only be really for Phase 2? Or are you envisioning them also contributing to the CapEx and being involved in Phase 1?

I could very well envision a phased approach there, too, with a more reduced partnership option in Phase I and a larger one in Phase 2, but that still remains to be determined.

The next question is from John Tumazos with John Tumazos Very Independent Research.

We know that you produce a little bit of base metals, too. And a large differential exists with zinc at $1.44 and lead at $0.93. Why do you think the zinc price outperformed where world steel output is down a couple of percent this year? And why do you think lead lags when world auto output is strong, China trending towards 33 million cars record, et cetera?

John, the base metals currently represent about 8% of our revenue, which we expect to increase once the La Colorada Skarn goes into production. Although it's a small segment of our overall revenue, zinc is experiencing strong demand as it is recognized in several countries as a critical mineral. Additionally, silver has also been added to this list in the U.S. The prices of base metals are influenced by the global economic outlook, and there are still concerns about future trends, which is reflected in the current prices. However, the recognition of zinc as a critical mineral will undoubtedly support its pricing.

The next question is from Ovais Habib with Scotiabank.

Michael and Pan American, congrats on a good quarter, leading to good free cash flow as well. Scott, congrats to you on your new appointment as well. Michael, a lot of my questions have already been answered, but some follow-ups to those questions. Starting off with the question on Cerro Moro, El Peñon, Timmins and I think Minera Florida as well. Obviously, they've had some issues in terms of reconciliation, geotech issues. Do you see these issues lingering into Q4? Or have most of these issues now been resolved? Just to clarify on that front.

Ovais, and you recall in Q2 and actually some of those technical issues started, we already mentioned that they will linger into Q3, which we see. So that's obviously the reason why our production profile, especially on the gold is more back-end loaded. As Scott mentioned, we see already an uptick on those grades. So looking forward to meet those guidance goals that we have. And maybe, Scott, do you want to add a bit more color to this?

Thank you for the kind words, Ovais. Regarding Timmins, we are facing some geotechnical challenges, particularly with our production drill holes in the deep central mining zone at the Bell Creek operation. To address this, we are using casings and, in some situations, a sealant or polymer, which has shown some success. Additionally, we are implementing extra ground support in areas with high strain and stress using dynamic support. The recently commissioned paste backfill system at Bell Creek is being utilized more effectively, and we are seeing positive results as the learning curve has improved. Overall, the numbers are looking favorable as we move into November, approximately halfway through Q4.

As we look towards 2026, is this more about getting ahead of production and development and accelerating those efforts as we approach 2026?

Yes, generally. At several of our operations, we've started additional development programs in the fourth quarter to provide more options as we approach 2026. In some cases, we fell behind in our development, which required us to acquire new equipment and, in some instances, hire external contractors. This includes Huaron and Timmins. However, it is in our best interest to ensure our success as we move towards the end of 2025 and into 2026.

Okay. And then just moving on to Juanicipio on the closing of the MAG transaction. Michael, is everything progressing according to your expectations? I mean, how involved are you with operations? And is there a push to get more exploration started around the area?

I'm incredibly happy with where we stand. We recently got a glimpse of what Juanicipio can do for us with just one month of production in Q3, and the strong output and cash flow from that operation are evident. With even higher metal prices now, the asset is performing exceptionally well. I visited the site last week, and it continues to impress. There is significant involvement from our operational teams across all levels, including operations, metallurgy, geology, and ongoing exploration. I'm very pleased with how things have progressed so far and I'm eager to see a full quarter of Juanicipio in Q4, especially with the favorable metal prices. In early to mid-January, we will typically release our forecasts for next year, which will also cover our budget and exploration spending. You'll see all the details regarding the production profile then. I would say that Juanicipio has at least met, if not exceeded, my expectations.

And my last question is on La Colorada Skarn. You're looking to announce the PEA in Q2 of next year. Is the announcement of the partnership exclusive of this event? Or will you need to see the PEA before you come to some sort of terms with the partner?

No, I think we will be able to announce the partnership earlier. I think as soon as we have a document executed on that, we will release that information.

The next question is from Cosmos Chiu with CIBC.

Michael. Thank you, Steve as well, and congratulations, Scott. Maybe my first question is also on the Skarn technical report that's potentially coming out next year or not potentially, it is coming out next year. As you mentioned, Michael, you got to take a phased approach now with a higher grade lower tonnage deposit upfront. I seem to remember the Skarn deposit is centered around some high-grade centers, the 901 zone, 902, 903. So is there one particular zone that is higher grade? I don't know if you have that answer yet. Are we looking at higher-grade portions from all 3 areas? Are we looking at the upper portions of all 3 areas? How should we incorporate what I know about 901, 902 and 903 into what we can see next year?

Yes, the high-grade core zones are mainly 901 and 902. We are continuing our drilling on 903, and we are seeing some interesting success with the Skarn, which seems to extend quite a good distance. It is still uncertain if there is a high-grade zone in 903 as well. However, the press releases over the last two years highlighting the high-grade intercepts of the Skarn have all been in 901 and 902. The combination of these high-grade zones near the surface that we published in September contributed to a significant increase in resources during our recent reserve and resource update. This combination is what enabled us to adopt a phased approach from the beginning, focusing on a strong project. A phased approach allows for lower initial capital and increased investment later as we gain a better understanding of the underground and the orebody. Importantly, this does not suggest that our silver production profile will be much lower than what we envisioned under the full large cave option. It minimizes execution risk, reduces capital requirements, and can expedite the project timeline. Overall, this represents an exciting development at La Colorada Skarn.

Yes, that sounds great. Maybe a follow-up then. Michael, as you mentioned, with this phased approach, the possibility is that the vein mine could run parallel with both Skarn phases. So is there some thinking in terms of some of that ore from the Skarn could actually go through the current mill?

No. The current production mill capacity is around 2,000 to 2,500 tonnes a day. I mean we're talking here about a multiple of that. So we will build a new mill much larger and then have that mill built with the potential to expand down the road for Phase 2. But yes, the current operation, the current mill is too small. But the metallurgy is very, very similar in terms of mineralization of the Skarn and the veins. So it's an easy project for us to kind of commingle the veins and the Skarn and put that through the same mill. So the metallurgical difference is just the current mill is too small for that.

Okay. Okay. Sounds good. So it's going to be a new mill from day 1 for the Skarn, but it could still run in parallel with the potential expansion later on?

Yes, that's the exciting advance here is that, obviously, putting the cave mining a bit later allows us to continue to mine those high-grade veins, which it seems like with the exploration, we keep finding more and more of it.

Yes. Maybe I do apologize. I do have a long accounting question here. I just want to get a better understanding of the equity method of accounting for Juanicipio. I was looking at Note #9, and I could kind of follow through. My understanding is that it's 44% of what Juanicipio reports 100%. So I can understand the $72 million in revenue, $11.9 million in production costs, $15.1 million in depreciation, so $45.1 million in mine operating earnings. But then it jumps to $37.1 million in net income and comprehensive income, and that's a gap that I don't really fully understand, which drives the $16 million pickup for Pan American Silver at the consolidated level. So could you maybe help me out in terms of that little gap?

Cosmos, it's Ignacio here. We can discuss this in more detail later if you'd prefer. There are several specifics not included in the report, particularly related to taxes and other significant items. Essentially, there is a substantial amount of information that is not reflected in the income and comprehensive income statements.

So I work it out to about 18%. Is that a good number to kind of use in terms of that difference or is each quarter a bit different?

I think let's give it a couple of quarters here because this is only 1 month of results. So I would say let's see what the next quarter looks like. And as I said, I'm happy to take this offline with you, and we can talk a little bit about.

I do apologize before asking the question. So I knew it'd be a little complicated. Any other accounting nuances that we should be aware of in terms of Juanicipio?

I would say that this is the same method MAG used to report Juanicipio. It’s a bit tricky since we haven’t dealt with this before. It’s challenging to discuss the company’s performance now because the performance of Juanicipio is included in the equity line or the investment in Juanicipio line, both in the income statement and the balance sheet. We've introduced some new non-GAAP metrics, such as attributable revenue, attributable free cash flow, and attributable operating cash flow, to help us better understand and discuss the company’s performance, including Juanicipio. Additionally, it's important to remember that the cash from Juanicipio that is at the joint venture level is listed in the investment in Juanicipio line on our balance sheet. Only when the Juanicipio joint venture distributes dividends will that cash show up in the cash and cash equivalents section of our balance sheet.

And that cash distribution is somewhat discretionary, correct?

Yes, they are on the schedule. Due to the transition between MAG and ourselves, there has been some delay. The joint venture has not issued dividends for a couple of quarters, but there should be a catch-up in the fourth quarter.

Okay. Great. And then maybe lastly, on the dividend. Great to see that you've increased it again the second consecutive quarter in terms of that increase. But in terms of the calculation, the $0.14 is a bit of a detour away from the matrix that you've given to us in the past in terms of dividend based on net cash. So I guess my question is, how should we not predict, but what should we expect for the next quarter? That's number one. And number two, how much of the fact that you were not able to use your NCIB in Q3 does that factor into you increasing on a discretionary basis your dividend in Q3? And will you use the NCIB again in the future?

Yes, regarding the dividends, we have some great news. This quarter marks a temporary departure from our usual dividend policy. The reason is quite straightforward: we are experiencing very strong cash flow generation. We have nearly recovered a significant portion of the $500 million cash we used for acquiring MAG. The Board felt that given this exceptional cash flow, it was appropriate to deviate from the dividend policy for one quarter and allow shareholders to benefit earlier. This decision is unrelated to the blackout period we were in until the NCIB transaction closed. We will continue to monitor the NCIB moving forward and will make share purchases opportunistically, which is not the reason behind the dividend increase. The increase is based on our cash forecasts and the expectation of a strong fourth quarter. It made sense to let our shareholders participate earlier in what is shaping up to be an exceptionally strong quarter.

I agree as well. Congrats again on a very good Q3 and look forward to the rest of 2025.

This concludes the question-and-answer session. I'd like to turn the conference back over to Michael Steinmann for any closing remarks.

Thank you, operator, and thanks, everyone, for calling in. Another great quarter, record revenue of nearly $890 million, record operational cash flows of $323 million, record attributable free cash flow of nearly $252 million, very strong numbers. That obviously led us to increase for the second time in a row now since Q2 to increase the dividend. It's great to have our shareholders participate not only in the increase of our share price, but also in additional return to our dividend policy. So great quarter. I'm really happy with where we stand. As I said, we saw the first glimpse of what Juanicipio is able to do here in the full quarter, which will be the first full quarter in Q4. We only had 1 month of the mine in Q3, and we see already a very positive impact. And just to the last question there from Don, we will see an important impact to our silver production here from Juanicipio looking forward. So I'm very happy with where we stand. I'm looking forward to a great and strong Q4 and report that early next year, but also report our outlook for '26 and show you in detail how our guidance for that cost guidance and production guidance looks like. So thanks, everyone, for calling in, and have a good rest of the year, and we'll talk in early year, I guess, February or so for our Q4 results. Thanks, everyone.

This brings to a close today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.