Americas Gold & Silver Corp (USAS) Q3 2026 Earnings Call Transcript

Welcome to the call. Thank you for standing by. My name is Jordan, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the America's Gold and Silver 3rd Quarter 2026 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, press star one again. All participants are limited to two questions only. Thank you. I would now like to turn the call over to Paul Hewitt, Chairman and CEO of America's Gold and Silver. Please go ahead.

Thank you, Jordan, and good morning, everyone, and welcome to America's Gold and Silver's third quarter 2026 conference call. As a reminder, this call is being recorded and will be available on our website's events page. We will also reference a slide deck during today's webcast presentation. Joining me today are Warren Barga, our Chief Financial Officer, who will review the quarter's financial results, and Oliver Turner. Our Executive Vice President of Corporate Development. Before I open up, I just want to say something here. I was reminded two days ago that it was Veterans Day or Remembrance Day, depending on which country you're in. And we have a number, quite a few, veterans who work for us. And to each of you that have served, I just want to personally thank each and every one of you. We're all reminded that we come to work for our families. We do all this hard work for a purpose. And those of you who have served, we thank each and every one of you. So I did want to open up by saying that. I will begin our operational and strategic highlights before turning the call over to Warren. And as normal cautionary notes, over on slide 3 of the slide deck, please review the cautionary statements concerning forward-looking information and non-GAAP measures in our third quarter MD&A, earnings release, and presentation. Unless otherwise noted, all dollar figures today discussed are in U.S. dollars. Over to slide 5 on the deck, the highlights. As always, safety comes first for us. I want to recognize our operating teams for maintaining zero lost time accidents since March of 2025 at Galena and April of 2025 in Mexico at COSLA. That achievement reflects daily discipline and a strong commitment from our operating and safety teams, particularly as we execute a substantial growth program. The third quarter for America's gold and silver was a tremendous milestone for us. Look, we produced just a little over 800,000 ounces of silver. On the silver equivalent, it was right around 940,000 silver equivalent ounces and sold about 860,000 ounces of silver. That's never been done in this company. In the 28-year history of this company, that has never been done. So I have to give a good credit and kudos to the entire team from the top to the bottom for breaking a 28-year record and one that we're very happy to be looking forward to be breaking this quarter. So well done to the team. For the first three quarters of 26, we produce about 2.3 million ounces of silver, and we are on pace to achieve the lower end of our guidance and existing full-year production. That 3.2 to 3.6 million ounces of silver, and our ASIC is likely going to be a little bit on the higher end of our guidance, but still at our guidance. But I just want to remind folks and reiterate something that I said even a year ago when I got here. These are big step-ups year over year. When we look at what the company has done before, what we're doing, these are massive milestones and big, big increases that we're doing in a district that's been around for 100 years. It's important to recognize that this performance came while we continue to advance critical development and are modernizing Galena. We continue the strength of Kosula. It provides us flexibility to accelerate the underground, and that will support Galena's aggressive future production as well. I'm going to go over to slide six, if you don't mind, at Kosula. Colesville had delivered another exceptional quarter, producing right around, you know, 420,000 ounces, call it roughly around that, of silver at a 23% increase quarter-over-quarter, 28% increase compared to the third quarter of 2025. This strong performance was driven by higher silver grades, improved underground movement from our newer equipment, and continued advancement into the heart of the higher-grade EC120. Despite processing less tons, the operation delivered significantly higher silver production, demonstrating the strength of the ore body and the team's ability to maximize production efficiently. I certainly want to take a moment here and recognize our team in Mexico for their outstanding execution this quarter. I want to reiterate something else here. Last year, we had a record in Mexico. As a company, we created a record. In the first 10 months of 2026, we broke that record. We still have two more months left, so we're going to shatter last year's record already. So when we talk about some of these milestones and some of these initiatives, I think people fail to get sucked into the market and silver prices and get discouraged. But we are delivering some of the greatest results in the company's history. And I can't not continue to reinforce that and continue to lead our people at both sites and continue to thank them and praise them for all their hard work. Copper production was also increased 30% year-over-year to approximately 736,000 pounds. Combined with higher byproduct credits, this strong operational performance contributed to it. A meaningful reduction in cash cost. Our cash costs were declined to around just a little over $14 per silver ounce compared to around $25 an ounce in Q3. So, tremendous cash savings there as we continue to deliver and mine in the different areas. Over to slide 7, beyond the strong production results, we are particularly encouraged by the continued exploration success at Kosovo. Recent infill drilling and step-out drilling at San Rafael Upper and the EC120 zones have blizzard exceptional results, further reinforcing our confidence in the quality and the potential of these ore bodies, and specifically these assets. If some of you have the slides open, just look at that slide 7, and I'll talk about one intercept here specifically. If you look at SR0583, it returned 20.5 meters, a grade of 654 grams per tonne, and a 1.5% copper. That's outside of the boundary of our 2025 inferred mineral resource inventory. And again, I'm just going to pause here for 10 seconds, and if you were to look at that slide and just look at some other results, I named off one, but there are other results, like 14 meters of 598 grams, 16.6 meters of 300 grams, 22 meters of 392 grams. The difference here is we're seeing results here at Kosala, people, results of grades that are very, very similar to what we see at Galena. They're world-class, except they're anywhere from 8 to 10 times the way. This is what we're getting to unlock in Mexico, which has been astonishing for us, so we're very, very excited. Many of you know that our Beta Hunt mine when we were at Corora had some exceptionally wide zones, similar to this. We had lower-grade cold back then, but it was so profitable because of the width, and that's what we're seeing here at Kosovo. There's no doubt in my 35-plus years of mining, I've never seen any widths followed by grades like this. These are some of the best you're going to see world-class. So I'm extremely excited to get these zones into a mine plan in 27 and beyond. Coast supply is certainly shaping up to be a very exciting asset with these kinds of intercepts. And look, again, if you look over to... Slide 7, you will be able to see what we're seeing. They're about five times the average grade of what we had previously modeled in the last technical update. So, stay tuned as we update the newest resource with this newer information. So, overall, the resource conversion drilling across San Rafael and EC120 has consistently returned grades. Two to three times the previously reported inferred resource, like I was saying. These results are particularly encouraging as we continue to better define the mineralization and always evaluate the opportunities to enhance our future mine plan. It is important to keep in mind that our recent growing results, and I said this, but I'm going to repeat it, was not included in the 2025 mineral resource and mineral reserve estimates. They demonstrate potential for additional resource growth and grade improvements, which will be evaluated as part of our future mineral resource estimates. Looking ahead to 27, I'm extremely proud and excited about what Kosala can do and continue doing. The operation, as I mentioned a little earlier, has already surpassed its previous annual production record in the first 10 months of 2026, putting us on track to have yet another record year, which we will do. With strong operational momentum, continue to accessing the higher-grade mineralization and encouraging exploration results, we believe KOSLA is extremely well-positioned to build on this success and remain a very strong key contributor to our long-term production growth strategy. Kosovo's performance also played a major role in helping America's gold and silver create a record that I talked about earlier in my presentation. Accomplishing 800,000 ounces of silver in a quarter. This milestone reflects exceptional performance from our Mexican operations. And, again, I do want to say hats off to our entire team. I hope many of you are listening on this call. Thank you for all your efforts. Over to slide eight about Galena. And I just want to remind people about something at Galena. As we continue to invest in Galena, and we continue to look down the road at Galena, we're not building something that we're trying to have a record quarter after quarter after quarter. What we're trying to do is something that will sustain for a very, very long time. We are building something and putting an infrastructure and spending money on something that will sustain something that's never been done before. So the amount of effort and hard work we're doing in the mine that's been around for 100 years, remember, it's been starved for capital forever. So this investment, we're very much needed at Galena, but we're building something that we want to make sure can be sustainable for a very, very long time. Our priority remains building the foundation for sustainable, higher-rate production. The complex produced just under 400,000 ounces of silver in the quarter as the operation continued recovering from some of the temporary interruptions we experienced in Q2 and prioritizing setting up our infrastructure improvements and mine plans, again, like I said, for long-term, sustainable production gains compared to just short-term flash in the pan. Following number three, SHAP improvements, we've been able to focus on much-needed and much-required waste development ahead of our future production areas in our silver-copper zone. This work is very essential to expanding our long-haul mining program and opening additional panels. We are seeing meaningful productivity gains as we continue to bring new high-grade stoves into production using long-haul mechanized mining and utilizing remote mucking. We increase the sea cycle times from anywhere from, I don't know, 150 to 200 tons per ship compared to what we used to have, 35 to 50 tons per ship using the conventional underhand cut and fill. And many of you analysts got to see it. Rather than using back legs, we're using a modernized long-hole drill. We continue to modernize the underground fleet. We didn't have any remote controls underground. We didn't have any trucks underground. They're now underground. They're operating. Our communications, our backbone, a leaky feeder system, we now finally have a leaky feeder system that allows us to speak into the mind, that allows a ship boss, for example, who used to be able to maybe speak about 15% of the time, We're going to be able to speak to them 100% of the time while they walk around doing their job day in, day out with this new communication system that we've implemented and adopted. These are all interdependent projects, and their benefits will build over time. Our focus is on executing them safely in the right sequence, rather than sacrificing the longer-term plan for short-term tons. Over to slide nine, exploration people. Exploration success at Galena is another reason we're obviously extremely exciting. Excited. Sorry about that. On the operating level 49, we intersected 1.2 meters of 1,061 grams silver, 0.7% copper, and 0.6% antimony. This is, again, another new discovery, but it's not the only one. We've had six brand new discoveries at Galena since we've been here over the last 15 months. And we're very excited about what they're going to bring into the future. These assay results are regularly intersecting the higher grade silver than currently modeled in the resource. It's the same situation as Kosovo. Many of these results represent potential upside, and they were excluded from the 2025 mineral resource inventory. So they will be included in our next version of our resource and reserve update. So we're looking forward to adding many of the drilling that we have done. These results are part of the largest exploration mineral resource conversion drilling our company has ever had in the history of a company. Across our operations, our people are delivering these advances while maintaining a strong safety culture, and I want to thank them for that. The team at Galena that we've assembled with Chris Corley, Evan Peltier, and Ian McMullen are doing an amazing job at really revitalizing that district, leading our team to some of the things that have never been done in that district. So we're very proud of Galena and where it's going and building the momentum that we're doing. With that, I'm just going to take a moment here and let Warren talk about some of the financial opportunities we have in front of ourselves. Over to you, Warren.

Thank you, Paul, and good morning, everyone. Today, we reported our consolidated interim unaudited financial results for the three and nine months ended September 30, 2026. Financial statements in MD&A are available on our website and through CDAR Plus and Edgar. The third quarter net revenue was $51 million, an increase of over 70% from $30 million in Q3 2025, primarily Due to the higher realized metal prices and increased silver production in the quarter. Year-to-date, revenue totaled $167 million, an increase of 106% year-over-year. We sold approximately 860,000 ounces of silver, an increase of 17% during Q3, at an average realized silver price of $61 per ounce, compared with $40 per ounce in the prior year quarter. In line with the market prices for silver. We reported a net loss of $5.6 million for the quarter, compared with a net loss of $16 million in Q3 2025. The improvement primarily reflected higher revenue and the elimination of the metal contract liabilities, which we fully settled in the second quarter of this year. Adjusted earnings were a loss of $4.9 million, or $0.02 per share. Adjusted EBITDA was $9.3 million, or $0.03 per share, compared with $1.9 million in the third quarter of 2025. In the quarter, cash costs averaged $30 per silver ounce sold, and all sustaining costs were approximately $43 per silver ounce sold. Year-to-date ASIC averaged approximately $39 million per silver ounce sold. We ended September with $63 million in cash and equivalents with $23 million in working capital, in line with our expectations, as the company continues to deploy capital into its consolidated revitalization and growth plans at both of our mines. Subject to satisfying certain condition, an additional $15 million is available under our existing term loan facility, providing the company with available liquidity of $113 million. I'll turn the call over to Oliver.

Thank you, Warren, and good morning, everyone. Our operational progress discussed by Paul is now supported by a stronger financial and strategic platform. Following the settlement of our remaining precious metals delivery obligations earlier this year in the second quarter, where we used our paper strategically, we have removed significant variable metal price-linked obligations and simplified our capital structure going forward. Just like ongoing operational improvements, these adjustments now allow more of our profits going forward to flow through to our shareholders. At Galena, our iterative flywheel approach to continuous improvement, identical to the strategy we executed previously at two other companies in the early years of those turnarounds, is beginning to deliver results. Much of these improvements do not show up immediately in quarterly numbers as we build the foundation for a very significant and sustainable silver production brace in the Silver Valley. To achieve this takes constant iteration and compounding operational adjustments to reach the level required to transform into a major silver operation. We're certainly excited by the progress we get to see every day and to date and remain well on our way to achieving our targets. We also continue to advance a differentiated growth story built around high-grade silver and critical minerals. At Galena, our ongoing exploration development programs support the longer-term opportunity in not just silver, but also copper and antimony. Our capital markets profile has also continued to strengthen America's names to the TSX 30 for 2026, ranking us as one of the best-performing companies over a three-year period. In October, we published our inaugural Corporate Sustainability Report, establishing a foundation for more comprehensive ESG measurement, risk management, and reporting as the business grows. For a very significant number of our shareholders, this is and was a critical catalyst to increasing allocation sizes, and we're very proud to have reached this important milestone. We're already working on our 2026 report, which we expect to publish in the first half of 2027. Together, these developments support our ambition to become one of North America's leading silver producers and a strategic supplier of critical minerals. So with that, I'll turn the call back over to Paul.

Thanks, Oliver.

Again, I'm just going to say something that I said a little earlier. Q3 was a record for our company. In fact, it was the strongest production quarter in a 25-plus year history of the company. And for that, I'm extremely proud of what our teams have accomplished, given the laser-like focus we have on safety. You can see how safety and production correlate together. It's very obvious. We've gone a year and a half of both sites without a last-time accident, and we're breaking record after record. We've delivered strong revenue growth, production sales, and continued investing in the infrastructure that will support the next stage of our business. Kosovo continues to demonstrate why it is such an important asset for our company. One of the most important requirements for turning around large-capacity operations, like we're doing at Galena, is supporting cash flows from other assets and having options. And look, some of you will remember at Corora, we had Spargo's reward fueling the investments we were making into Beta Hunt and to Higginsville in those early years. Here at America's Gold and Silver, our significant capital deployments, operational improvements at Galena are fueled and helped by the cash flow generations from Kosovo in these early years as we continue to turn it around. On top of that, our world-class exploration results at both Kosovo and the Galena complex. Reinforce the scale of the opportunity at each operation. As we look to finish a strong 2026 and end with our guidance, our priorities remain absolutely crystal clear. Keep our people safe. Execute the important work required to facilitate sustainable higher production levels at all operations. Looking beyond this year, the long-term case for our metals continues to strengthen. Silver and antimony are increasingly important to advanced manufacturing, electrification, AI infrastructure, and national security. With high-grade operations at Kosovo and Galena and our antimony joint venture with U.S. antimony, we believe America's gold and silver is well-positioned to contribute meaningfully to those supply chains. Just want to take a moment and thank each and every one of you for your interest in America's gold and silver, and we look forward to a couple of questions at the moment. Jordan?

As a reminder, if you'd like to ask a question during this time, simply press star, followed by the number one on your telephone feedback. We'll take a brief moment to compile the Q&A roster. Your first question comes from the line of Alexander Malbray from BMO Capital Markets. Your line is live.

Hi, Paul and team. Thanks for taking my question. I have two. So the first one is, you've been working to address several long-standing bottlenecks at Galena. Which improvements have made biggest differences so far, and what changes are your teams seeing underground?

Yeah, Alex, a very good question, actually. It's a great one to start off with. Look, I think... And recently here, just before Beaver Creek and BMO, many of the analysts got to see it with their own eyes. I think you got to see a number of things we're doing. I mentioned one a little earlier today, like a new communication systems. You don't usually get credit for something like that, but it costs you $3 million. Our mind had nothing. Having the ability for a supervisor to be accounted on or available 100% of the time instead of 15% of the time matters. So those things matter. The muck flow movement, this is a big one. You think about, well, this mine's been around for 100 years. It's always been handheld jack-o-lantern. Think about the size of fragmentation that produces. It might be the size of your fist, or maybe a big piece is the size of somebody's head. When you're drilling and blasting in long holes, you're going to get bigger rock, and our system wasn't set up to accommodate that. We didn't have grizzlies in place, so Evan and the team have quickly put in grizzlies into place. They put in rock breakers. There were pictures here two years ago, Alex, of people on Grizzlies at the loading pocket with hammers, double jack hammers. They're like, oh my God, how old is this? So we've upgraded our rail system, bigger cars, added Grizzlies. Obviously, it goes without saying changing the mine method is the biggest one, but it does. Have consequences. It does have cheaper costs, quicker turnaround, different fragmentation. The mine was never set up for that. So putting in all these things like the grizzly updates, the ore cars, the leaky feeder, obviously, without doubt, the shaft upgrades have been amazing that Evan and the team have done. We've gone from 40 tons per hour to over 100 tons per hour. There are so many of these things, and again, I'm repeating myself, but it was great to have the analysts come and see, when you get to walk into an old vine and you see there's a brand new skip or a brand new cage, you can see the dollars we have spent or a brand new rock breaker. You're like, okay, this is going, all these things are not, we're not doing that to have an outstanding quarter. We're doing that to build infrastructure that will be here for 20 plus years that will last a long time. So I mentioned a whole bunch of them here, Alex. They're all very equally important, and each bottleneck has to be overcome in order for us to achieve these new levels and new heights and sustain them. Again, I know I'm repeating myself, but sustaining them and making sure we do them quarter after quarter is what matters. It needs to become boring. You need to say, you're going to get to a certain level, and this thing is going to become, you're going to do it time and time again. You're going to be very consistent, just like we did at Klondex, just like we did at Karor, and it's got to be that way. So hopefully the whole bunch of them, I know it was a long answer, Alex, but there was like five of them that I gave you.

No, thank you for that. My second question is more of a follow-up on that. So, with the shaft improvements completed and additional infrastructure advancing, what are the next milestones needed to translate the investment into higher, more consistent production?

Yeah, one of the big ones, again, I think people got to see with their own eye. There's two of them that are still outstanding. The new Paceville plant and our team on site are doing an amazing job managing the contractor and getting that done. We're the only mine in the district that doesn't have a modernized space mill plant. We need that. We know we're going to, well, we're hoping to start it in Q1. It'll likely be built at the end of the quarter. We're going to see how the weather is. When we start this thing up, this is going to be something, again, going to last forever. And this is a perfect example where we didn't think about a short quarter. We thought about, hey, if we added a couple extra, if we spent more money today and we look into the future, we could increase kale's capacity by over 10 years by spending money today. And that's the type of approaches we're doing on every project we do. So for the peso plant, not only will it allow us to fill faster, have a better, more homogeneous compressive strength, something much more reliable like everyone else does, But we're now being able to extend our tail's damn life because we're putting in a dry stack at the back end of this. These are the types of decisions that you take today that don't have an impact in a week or two weeks, but they will have an impact forever for sustaining the biggest production that's ever come out of these mines in history. The second one, Alex, is really we've been squarely focused here now that Evan and the team have been pushing pretty hard at getting. Waste footage and ore footage up at moving waste development. We've suffered from not having enough waste development in front of ourselves. We need to get waste development in front of ourselves. So those two things, the Peso plant and waste development are very key and critical to us making sure the rest of the things fall in line together.

Your next question comes from the line of Cole McGill from Stiefel. Your line is live.

Hey, guys. Paul, Warren, Ollie. Thanks for taking my question and good morning. Thanks for walking through some of the material handling advancements you've had over the year. Can you provide a bit of color on the mining front and specifically the transitional long hole? What dilution over breakage is like and tracking versus where you thought you'd be at this point?

Yeah, look, that's a great question, Cole, and here's what we're doing. Not unlike any other mine anywhere in the world that has long hole, what we're identifying is different domains, geological domains, and what I mean by that is we will have long hole at this mine, call it 75 to 80 percent of it. It will never be 100 percent. We always knew that. However, We will mine that long hole, very narrow, but we will mine it maybe differently. What I mean by that is we might be drilling a two-and-a-quarter-inch hole in one area. In another hole, in another area domain, we might be drilling a two-and-three-quarter-inch hole. The spacing might be different. The way we blast the football or the hanging wall might be different. We might be putting in cable bolts on the hanging wall in some areas, and we might not do it in another area. So as you... And bring in Longhole into a new mine, just like we did at, let me just be very clear, we did this at Midas, we did this at Fire Creek, we did this at Hollister, we did this at Beta Hunt. This is not new. This is something we have done time and time again, and I've learned this from doing it in Red Lake and Kimmins, Ontario, and Renabee, so this is not something that is new. What we need to do is identify the different geology, the different matrix, and how you drill and blast almost so that you do exactly what you said. You make sure you prevent any dilution. We've got stopes here that we've taken out in some areas where there's no capables. We're drilling a normal pattern like I had at Midas or Fire Creek. We are seeing no additional dilution at all. Nothing at all. There's going to be, I suspect, two to three different domains that we're going to identify, but that's going to come with the more stokes we mine. And we'll say, all we're doing is we're changing the way we drill or blast or muck. And or backfill or backfill in those areas. Sometimes we'll use conventional fill. Sometimes we'll use the new pay fill plant. So the demodernization of long haul has been so overwhelmingly successful. It's actually blown my mind how we see some of the stoves. Like we've got pictures in our slide deck. If you just look at our slide deck, you can see a top cut. You can see a bottom cut. You can see how narrow 1.1, 1.2 meters wide. We have visitors from all over the U.S. There's mining companies from all over the U.S. asking us, can we come and see what you guys are doing? And of course, we're going to help others. Why wouldn't we? It's in our best interest to always help neighbors or people in our mining industry. But they're seeing the pictures in the slide deck. Analysts are seeing it underground. Our miners are seeing it. And we're able to take a stoke that would have taken us 12 months to drill and blast with back legs. We're able to do it in less than 30 days. It's cheaper. It's more efficient. What we need to do is understand the different domains. That doesn't come in two months. That happens over time. It took me about four years to do it at Midas. We're not seeing additional dilution. What we're actually seeing is the dilution is flat. We're not getting any additional dilution. Just look at the pictures. But all I'm saying is that in the different areas of the mine, as we continue to mine long hole, we will just continue to refine it and get better. If there's an area of the mine that the vein is 70 degrees coal, you might want to put cable bolts in the hanging wall, and those are yet to be identified. So it's fluid, it's a work in progress, and we will continue to adopt and move very, very quickly as we look at our top cuts, our bottom cuts, and another example is the strike length of the stove or the length of your hole. Sometimes you might go to a 12-meter hole where in Australia I was able to push to an 18 to 20-meter hole. So all those things matter by domain, and then we're learning that as we continue to adopt long holes. At Galena, which has been, again, overwhelmingly successful. I know it was a long-winded answer, but it's not a simple answer, Cole, because there's a lot of moving parts, and it is fluid.

Yeah, no, 100%. Thanks for that, Paul. And one more for me, if I may. Can you kind of provide a bit of color?

My apologies, they've dropped. I'll place them right back in. I'm just trying to find Cole on the list here, just one moment. Your line is live.

Thanks, Operator. And thanks, Paul, for the follow-up there. Just one more for me, if I may. Can you kind of walk us through how the progress with some of the development towards some of the higher-grade silver-copperors transitioning, and when we could start to see some of that hit the mill into 27?

Yeah, look, again, Cole, another great question. Here's how I'm going to answer that. I'm going to say something that some of you got to see, and we said it at the site. I've been personally mining. Many of you have followed me for over 15 years, and thank you for that. But I've been mining 39 years. And when I consider mining as a whole, and I look at new discoveries, let me use one, a great example for you, Cole. A year, a little over a year ago, we discovered the 034 vein. It was a brand new discovery at Galena. And just to reiterate, we've had six new discoveries. Six. We had a brand new discovery, brand new. You think about... We're announcing a new discovery anywhere in the world, whether it's in the U.S., whether it's in Canada, whether it's in Mexico, South Africa. Pick a place in Australia. You have a new discovery. How long does it typically take a company to get into that new area? We had a brand new discovery about 18 months ago. We followed up with around 15 to 25 holes. We followed up with a drift into it. When the analysts were here about a month ago, we actually took the first cut out of that 34 bank. In less than 16 months, we went from a brand new discovery. That wasn't even in our model yet. That's how quick we've been able to adopt and move so fast because of the existing infrastructure, because of everything that's already in place. We've got billions of dollars of infrastructure in place here. We get to drill it in a shorter hole. We get to drill it from underground. But more important, this is fully permitted, ready to go. We get to access it quickly, to your question. So we have known cases of areas that we have discovered about a year ago that we're already mining in. So for us, as we look into the future and we look into the six new discoveries, all we're doing is looking at shedding off maybe some of the lower grades and replacing it with some of the higher grades than we've already discovered. But think back in your own lifetime, Cole, or anybody's, like from a discovery to the time they're mining. And I know I can tell you cases where it's 5, 10, 15 years, a new discovery, 10 years later, they're mining it. We're talking months away here. That's unbelievable. Because of the existing infrastructure we have, we walked into a mine that has been around for 100 years. It wasn't modernized. It was starved capital. But all that 100 years still helped us as shareholders. Cole, I'm one of the largest shareholders of the company. I've never felt better about what we're doing, ever. When I see the records, when I see the future, when I look into it, I tell my wife and eight kids, listen, we have a tremendous opportunity in front of ourselves. This was never a 100-meter dash. This was always a marathon. And by God, stick to the plan, because we're going to win this marathon.

Your next question comes from the line of Ken Illdive from SCP. Your line is live.

Hi, Paul. We're on the rest of the team. Maybe you'll just start from Kosala. You guys had a very good quarter there. I was just curious how much of that came from EC120 grade and basically how the O-body is reconciling to the model. As we're heading to 2027.

Hey, Ken, look, thank you very much for the question. As we continue, I'm just going to repeat something I said a little earlier because I think it is very, very worthwhile mentioning, especially some people listening to the call afterwards and they listen in on the Q&A. It's worth mentioning that when we look at COSELA as a whole, In the first 10 months of the year, Ken, we've already beat last year's record. And 2025, Ken, it was a record for this company. The company had never achieved in Mexico what we did in 2025. In the first 10 months, we've already beat that record. We still have two more months to go. You look at our cash costs dropping from about $25 cash cost to about $14.50 cash costs. Why? Because of the copper byproduct credits. And where is it coming from? To your point, it is coming from EC120. We are finally into an area. We've been talking about it for a year since I've been here. I've been here, call it 18 months now. We're going a little over 18 months. We've been excited to get into this area. What's extremely exciting is what you asked the question about, the reconciliation. Well, it's reconciling a lot higher than the model. Well, why? Well, it's simple. The model had about 100 grams per ton. We're seeing areas that we're intercepting that are anywhere from four or five times that. So I can't wait to see the next resource, the next revision of this resource update. It's going to be very exciting because we didn't have these drill holes. We've got about, look on that slide seven. You wrap around that. There's about 10 drill holes, all of them, grades of Galena, and this is where we're in. We're mining into those things. So as we finish the year. We know it's going to be a record for the company, Kosovo. We're setting ourselves up for 2027 to continue this strong growth and the performance that we've seen from Kosovo. So hard not to be excited, and I know I'm repeating myself, but I am a very large shareholder, and I couldn't be more excited about what the future is going to deliver for us and other shareholders.

Okay, yeah. Thanks for that. That was good. Maybe just switching gears a little bit to Galena. I was kind of reading the MDA, and I saw OPEX per ton was higher than last quarter, right? There's a little bit of commentary in there about September development push, and I was just wondering how much of... So this increase is sort of one-off from this development push versus, say, structural. And how much are you looking to see costs reduce into Q4?

Yeah, look, we've been very focused at both of our operations, Kosala and Galena. Galena, if I haven't said it once, I've said it a thousand times. Galena's been starved for capital for three decades. We've got a hundred-year-old mine that we're trying to modernize. We believe in the guidance numbers we've set out. We expected us to be on the higher end of the guidance, but we still know that it's a very achievable number. But there's no doubt we have to finish the capital projects, and we've been fairly focused since the shaft upgrades have been done, and we've been breaking records on waste development or development. We've only been breaking those records, by the way, and we're talking anywhere from 25% to 35% increase in some of these footages because of the de-bottlenecking of the shaft and putting in the grizzlies and other things. And so, we have to finish all these projects that we have in front of us. And I've talked a bit about how many more we have in front of us. So, certainly, Galena. And we know the costs were a little slightly higher than we had intended, but we are not doing something that we want to do the clash of events. And I think the best way for me to repeat something, Ken, is to talk about the Paceville plant. The Paceville plant was originally designed to just be Paceville, but we're now extending the tail's mind, the life of the tail's dam by eight to 10 years. There is no real estate in Idaho. Go find a flat piece of land in Idaho. You're surrounded by mountains, or a better thing, surrounded by mines. Throw a dart on a 20-mile long section in Idaho. There's 15 mines lined up in a row, but there is no flat land. So for us, and why do we see an increase in cost? We know some of it is these capital projects, some of these projects that we're doing that will sustain the longer-term production.

That concludes our question-and-answer session. I'll now turn it back over to Paul Hewitt for closing remarks.

Dad, Gordon, look, I just want to take a moment and thank all the analysts, all our shareholders. Look, we see the market. We all see it. We feel it. Nobody feels it more than the team on the ground. I can't express the gratitude I have for both of our operating teams at Galena in Mexico, and in closing, I'm going to say as one of the largest shareholders of America's gold and silver, I have never been more excited about what we have in front of us and the future for this company. So thank you to each and every one of you for joining us here today. Have a blessed day. All the best.

That concludes today's meeting. You may now disconnect.