1Q25 Earnings Results Conference Call Cautionary Statement This presentation contains certain information that may constitute forward-looking information under applicable U.S. securities legislation, including but not limited to information about costs applicable to sales, general and administrative expenses; production volumes; current expectations on the timing, extent and success of exploration; development and metallurgical sampling activities, the timing and success of mining operations and the optimiz ...

Compañía de Minas Buenaventura (BVN) Q1 2025 Earnings Call May 01, 2025 10:00 AM ET Company Participants Leandro García - CEO & General ManagerRenzo Macher - VP - Projects and InnovationDaniel Dominguez Vera - Vice President of Finance & Administration and CFOJuan Carlos Ortiz - Vice President - Operations Conference Call Participants Sebastián Valencia Carrasco - Senior Financial Analyst - IRCarlos de Alba - AnalystTanya Jakusconek - AnalystAlex Hacking - Analyst Operator Good morning, ladies and gentlemen ...

Compañía de Minas Buenaventura (BVN) Q1 2025 Earnings Call May 01, 2025 10:00 AM ET Speaker0 Good morning, ladies and gentlemen. Welcome to the Companion Gamingas Buenaventura First Quarter twenty twenty five Earnings Results Conference Call. At this time, all participants are in listen only mode. And please note that this call is being recorded. I would now like to introduce your host for today's call, Mr. Sebastien Valencia, Head of Investor Relations. Mr. Valencia, you may begin. Speaker1 Good morning, a ...

Market Prices - The morning fixing price for gold on the London Bullion Market was US$2,611 per ounce on December 31, 2024, and US$3,120 per ounce on March 31, 2025[51]. - The afternoon fixing spot price of silver on the London market was US$28.91 per ounce on December 31, 2024, and US$34.06 per ounce on March 31, 2025[51]. - The London Metal Exchange Spot Price for copper was US$8,706 per tonne on December 31, 2024, and US$9,673 per tonne on March 31, 2025[51]. - A continued decline in market prices of gold, silver, and copper could adversely impact revenues, net income, and cash flows[53]. Operating Costs and Profitability - Increased operating costs, including higher equipment, energy, and production costs, could adversely affect profitability and results of operations[68]. - The company no longer engages in hedging activities for gold and silver prices, exposing it fully to market price fluctuations[51]. Mineral Reserves and Exploration - The company may face challenges in replenishing mineral reserves due to the speculative nature of exploration and potential changes in economic feasibility[64]. - The estimates of proven and probable reserves are subject to uncertainties, and actual recovery may vary from estimates[72]. Tax Liabilities - The tax claim for the years 2007, 2008, 2009, and 2010 initially amounted to 373.3 million soles (approximately US$99.0 million), escalating to 2,107.5 million soles (approximately US$559.0 million) due to penalties and fees[78]. - The total amount paid for the disputed tax assessment related to fiscal years 2007 and 2008 was S/1,584,227,000 (equivalent to US$420,219,000), while for fiscal year 2009 it was S/193,398,000 (equivalent to US$51,299,000), and for fiscal year 2010 it was S/356,691,000 (equivalent to US$94,613,000)[80]. - As of 2023, the probability of recovering a portion of the payments made under protest to the Tax Administration related to fiscal years 2009 and 2010 was assessed to be less than 50%, leading to a recognized liability of S/420,231,000 (equivalent to US$111,823,000)[82]. Labor Relations - Unions represented approximately 17.6% of the company's and its subsidiaries' employees as of December 31, 2024, indicating potential risks related to labor disputes[88]. Partnerships and Interests - The company holds a 19.58% partnership interest in Cerro Verde and has no longer any interest in Yanacocha, having sold its stake to Newmont on February 8, 2022[96]. Credit Ratings - The company is rated "BB" by Fitch, "Ba3" by Moody's Investors Service, and "BB-" by S&P Global Ratings, which could impact borrowing costs if ratings are downgraded[102]. Political and Social Risks - The company has faced local political protests and social risks that could disrupt operations and affect future mining projects[89]. - The political and social situation in Peru directly impacts the company's operations, with significant unrest leading to violence and vandalism affecting mining facilities[121]. - Over 60 Peruvians died during three months of violence in early 2023, impacting public and private institutions, including critical mining infrastructure[122]. Legal and Compliance Risks - Legal proceedings against SUNAT could have a material adverse effect on the company's business, with ongoing appeals in Peruvian courts[85]. - The company is subject to evolving anti-bribery and anti-corruption laws in Peru, which may not be as stringent as those in other jurisdictions, necessitating ongoing compliance efforts[110]. Community Relations - The company has implemented extensive community relations practices to manage social issues that may arise at its operations[101]. Geotechnical and Environmental Risks - Geotechnical challenges could adversely impact production and profitability, with potential risks from severe weather and hydrological conditions[91]. - The company owns 15 tailings dams, including 1 under construction, 5 active, and 9 inactive, which could present stability risks, especially related to liquefaction[104]. - The company maintains strict operational controls on critical components to mitigate risks associated with tailings dam failures, which could lead to severe damages and loss of life[106]. Cybersecurity Risks - Cyber incidents, including deliberate attacks, have been increasing, posing risks to the company's information technology systems and potentially disrupting operations[107]. - A cyber-attack could cause temporary interruptions in production and expose the company to liabilities if sensitive personal information is compromised[108]. Shareholder Rights and Corporate Governance - As of March 31, 2025, the Benavides Family holds approximately 35% of the company's outstanding share capital, potentially limiting other shareholders' influence[129]. - Shareholders' rights under Peruvian law are less defined compared to those in the U.S., which may complicate enforcement of their rights[132]. - The company is subject to less stringent disclosure requirements than U.S. companies, potentially resulting in less information available to investors[134]. - Holders of ADSs may be unable to exercise preemptive rights and accretion rights for Common Shares unless specific conditions are met[136]. - A capital increase requires approval from holders of at least 40% of Common Shares at a properly called meeting[136]. - U.S. Holders of ADSs may face limitations in exercising rights unless a registration statement under the Securities Act is effective[136]. - Any rights offering could have a dilutive effect on shareholders who do not exercise their rights[136]. - The Depositary has discretion to sell preemptive rights or accretion rights for holders of ADSs and distribute net proceeds[136]. - If the Depositary cannot make rights available, they may allow the rights to lapse[136].

Financial Data and Key Metrics Changes - Full year EBITDA for 2024 reached $431 million, a significant increase from $199 million in 2023, resulting in an EBITDA margin of 37% compared to 24% the previous year [8] - Net income for 2024 was $402.7 million, a substantial rise from $19.9 million in 2023, with a cash position of $478 million and total debt of $627 million, leading to a leverage ratio of 0.34 times [9] - Total capital expenditures (CapEx) for 2024 amounted to $378 million, with $291 million allocated to the San Gabriel project [11] Business Line Data and Key Metrics Changes - Silver production in 2024 reached 15.5 million ounces, a 69% increase from 9.2 million ounces in the previous year, with significant contributions from Uchucchacua and Yumpag complex [11] - The all-in sustaining cost for the fourth quarter of 2024 increased by 26% year-over-year, primarily due to increased exploration activities [13] Market Data and Key Metrics Changes - The company anticipates stable copper and silver production at El Brocal and Uchucchacua, maintaining consistent output levels [21] - The expected cash cost for the San Gabriel project is projected at $1,400 per ounce of gold, with an anticipated annual production of approximately 120,000 ounces [32] Company Strategy and Development Direction - The San Gabriel project is expected to become the main gold-producing asset, playing a crucial role in the company's long-term growth strategy [13] - The company has resumed its dividend payment policy, proposing a dividend of $0.2922 per share, reaffirming its commitment to delivering returns to investors [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the financial position following successful bond issuance, which enhances liquidity and flexibility for future growth [21] - The year 2025 is viewed as a significant transition period, with the ramp-up of production at San Gabriel marking an important milestone [21] Other Important Information - The company received $166.5 million in dividends for the full year 2024, including $78.3 million related to its stake in Cerro Verde [10] - The construction of the San Gabriel project is 71% complete, with the ramp-up phase expected to commence in the third quarter of 2025 [17] Q&A Session Summary Question: What are the key elements of the construction of San Gabriel that are still pending? - The main goals for the next three months include commissioning the electric room in the crusher circuit and the carbon in leaching area [29] Question: What is the expected cash cost and all-in sustaining cost for the San Gabriel project? - The expected cash cost is $1,400 per ounce of gold, with an annual production of around 120,000 ounces [32] Question: Is the proposed dividend the only payment for 2024? - The management proposed a dividend of around $80 million, which is 20% of net profit, and is open to evaluating additional dividends in the future [44] Question: Are there any risks related to the completion of the San Gabriel project? - There are minimal risks regarding procurement and weather, with no significant delays anticipated [52] Question: What is the expected cost for El Brocal? - The expected cost for El Brocal is around $6,500 per tonne of copper, with stable performance anticipated [56] Question: What is the progress on the underground mine at San Gabriel? - The underground mine is on track, with 20,000 tonnes of ore already on the surface and plans to increase stockpile to 300,000 tonnes by October [70] Question: What is the expected dilution in the stope models? - The expected dilution is around 12%, which will be monitored and fine-tuned as operations progress [82] Question: When will the updated reserves for San Gabriel be reported? - The updated reserves are expected to be reported on April 30 [90]

4Q24 Earnings Results Conference Call 109 149 130 FY24 FY25E 13.8 15.5 15.7 FY24 FY25E 55 57 60 FY24 FY25E $330M $355M- Maintenance ~$135M San Gabriel ~$180M Growth ~$30M +6% +1% -13% Kton-Cu MOz-Ag kOz-Au CAPEX Copper Silver Gold 4 Cautionary Statement This presentation contains certain information that may constitute forward-looking information under applicable U.S. securities legislation, including but not limited to information about costs applicable to sales, general and administrative expenses; produc ...

Core Viewpoint - Markets are experiencing volatility due to escalating tariff concerns and stagnant interest rates, making value investing a strategic approach to identify fundamentally strong stocks trading below their intrinsic value [1] Earnings Yield Analysis - Earnings yield is calculated as annual earnings per share (EPS) divided by market price, serving as a measure of anticipated return from earnings for each dollar invested [3] - A higher earnings yield indicates a stock may be undervalued, while a lower yield suggests it may be overpriced [3] - Earnings yield can be compared to prevailing interest rates, such as the 10-year Treasury yield, to assess relative value against fixed-income securities [4] Investment Strategy - A screening criterion of an earnings yield greater than 10% is established, supplemented by additional parameters such as estimated EPS growth and average daily trading volume [6][7] - Stocks with a Zacks Rank of 1 (Strong Buy) or 2 (Buy) are expected to outperform peers in various market conditions [8] Selected Stocks - **Dana Incorporated (DAN)**: Expected 2025 earnings growth of 79%, with a recent EPS estimate increase of $0.20, Zacks Rank 1, Value Score A [9] - **Ingevity Corporation (NGVT)**: Anticipated 2025 earnings growth of 62%, with a $1 increase in EPS estimates, Zacks Rank 1, Value Score B [10] - **Compania de Minas Buenaventura S.A.A. (BVN)**: Projected 2025 earnings growth of 30.5%, with a $0.03 increase in EPS estimates, Zacks Rank 1, Value Score B [11] - **Noble Corporation (NE)**: Expected 2025 earnings growth of 22%, with an $0.08 increase in EPS estimates, Zacks Rank 1, Value Score A [12] - **Suzano S.A. (SUZ)**: Anticipated 2025 earnings growth of 395%, with a $0.21 increase in EPS estimates, Zacks Rank 1, Value Score A [13]

Core Viewpoint - Compañía de Minas Buenaventura S.A.A. has successfully completed a cash tender offer for its outstanding 5.500% Senior Notes due 2026, with a significant participation rate of approximately 72.98% of the total notes outstanding [1][2]. Group 1: Tender Offer Details - The tender offer expired on January 29, 2025, at 5:00 p.m. New York City time, with valid tenders received for US$401,392,000 in aggregate principal amount of notes [2]. - Holders of the notes who validly tendered their notes will receive US$1,000 per US$1,000 principal amount of notes, plus accrued and unpaid interest from the last interest payment date to the settlement date [3]. - The complete terms and conditions of the tender offer are detailed in the Offer to Purchase and the Notice of Guaranteed Delivery, which are available through the designated tender agent [3]. Group 2: Management and Contact Information - Banco BTG Pactual S.A. – Cayman Branch and J.P. Morgan Securities LLC have been engaged as dealer managers for the tender offer [3]. - Inquiries regarding the terms of the tender offer can be directed to the dealer managers via provided contact numbers [3].

Core Viewpoint - Compañía de Minas Buenaventura S.A.A. has announced the expiration of its cash tender offer for its outstanding 5.500% Senior Notes due 2026, with a significant portion of the notes being tendered by the expiration time [1][2]. Group 1: Tender Offer Details - The tender offer expired on January 29, 2025, with valid tenders received for US$400,601,000 in aggregate principal amount of notes, representing approximately 72.84% of the outstanding notes [2]. - Notices of Guaranteed Delivery were submitted for US$850,000 in aggregate principal amount of notes, approximately 0.15% of the outstanding notes [2]. - Holders of notes must validly tender their notes by January 31, 2025, to participate in the tender offer under the Guaranteed Delivery Procedures [2][3]. Group 2: Payment and Settlement - Buenaventura expects to accept and make payment on February 4, 2025, for all notes validly tendered and not withdrawn by the specified deadlines [3]. - Eligible holders will receive US$1,000 per US$1,000 principal amount of notes, plus accrued and unpaid interest from the last interest payment date to the settlement date [4]. Group 3: Final Results and Communication - The final principal amount of notes purchased will be announced in a press release after the settlement date [5]. - Interested parties can obtain the complete terms and conditions of the tender offer from the designated tender agent and information agent [5].

Tender Offer Details - Compañía de Minas Buenaventura SAA announced a cash tender offer for its outstanding 5.500% Senior Notes due 2026, with a principal amount of US$550,000,000 [1] - The purchase price is set at US$1,000 for each US$1,000 principal amount of Notes, plus accrued interest up to the settlement date [1] - The Tender Offer is scheduled to expire at 5:00 p.m., New York City time, on January 29, 2025, unless extended or terminated earlier [2] Conditions and Procedures - The Tender Offer is subject to certain conditions, including the completion of a new notes offering to provide sufficient funds for the tender [3] - Holders can withdraw their tendered Notes at any time before the Withdrawal Deadline, which is also 5:00 p.m., New York City time, on January 29, 2025 [2] - Settlement is expected to occur on the fourth business day following the Expiration Time, unless the Tender Offer is terminated earlier [5] Additional Rights and Options - The company reserves the right to extend, waive conditions, terminate, or amend the Tender Offer at its discretion [3] - After the Expiration Time, the company may redeem or purchase any remaining Notes through various methods, including open market purchases or private transactions [4] Agent and Manager Information - D.F. King & Co., Inc. is the tender agent and information agent for the Tender Offer, providing access to the Offer to Purchase and Notice of Guaranteed Delivery [7] - Banco BTG Pactual S.A. – Cayman Branch and J.P. Morgan Securities LLC are the dealer managers for the Tender Offer, handling inquiries related to the terms [8]