Hochschild Mining (OTCPK:HCHD.F) Update / Briefing Transcript

Summary of Hochschild Mining PLC Q3 Results 2025 Conference Call Company Overview - Company: Hochschild Mining PLC - Industry: Mining, specifically gold and silver production Key Points and Arguments Production and Financial Performance - Group production for Q3 was over 70,000 gold equivalent ounces despite minimal production from Mar-a-Rosa due to a four-week processing plant shutdown in July [2][4] - Mar-a-Rosa's production rates improved from 44,000 tons per day in August to over 70,000 tons per day [3] - Imaculada produced close to 50,000 gold equivalent ounces in Q3, contributing to a total of 156,000 ounces for the year, on track to meet the annual forecast of 199,000 to 209,000 ounces [4] - The company ended the quarter with a cash balance of $92 million, net debt of $246 million, and a net debt-to-EBITDA ratio of 0.4 times [5] Operational Challenges and Adjustments - Lower grades in production were attributed to adjustments in mine sequencing to address geomechanical challenges, which have now been resolved [4][16] - A $40 million increase in working capital was noted, primarily in Argentina, to safeguard the balance sheet ahead of midterm elections [6][19] - The company is exploring opportunities to process previously marginal lower-grade material due to sustained higher gold prices, which could improve margins [6][11] Future Outlook - The company expects production rates from Mar-a-Rosa to rise in Q4, with guidance set between 35,000 and 45,000 ounces [4][27] - The turnaround program at Mar-a-Rosa is progressing well, with all four tailing filters operational [3][39] - The company is in the budgeting process and considering a potential 15% reduction in production due to lower cut-off grades, but expects the impact to be less than 10% [11][34] Exploration and Project Development - The brownfield exploration program is yielding encouraging results, expected to lead to further resource additions [5] - The Vulcan project, which has around 11 million gold ounces in resources, is progressing towards feasibility and permitting stages, with an estimated construction CAPEX of $1 billion [21][29] Market Conditions and Strategic Decisions - The company is maintaining its CAPEX levels and is not planning additional development to reach lower-grade areas, focusing instead on maximizing net present value [12][35] - The management expressed confidence in the team's performance and the company's outlook for 2026 [39] Additional Important Information - The company is managing inventory strategically in Argentina to avoid currency conversion losses ahead of elections [19][25] - The management is optimistic about the impact of higher gold prices on cash flow generation in Q4 [6][39] This summary encapsulates the key points discussed during the conference call, highlighting the company's production performance, operational challenges, future outlook, and strategic initiatives.