DPM Metals Inc.

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4 presentations this morning we're gonna start with the DPM metals and Fireside chat. We'll then move to Triple Flag Fireside format. We'll. We'll then move on to First Majestic and then we'll finish off with Equinox Gold and so, with no further ado, let's move on to our first speaker and fireside chat style. I do want to leave 3 to 4 minutes at the end for questions, so please feel free to to wait till then and so I'm pleased to present to you, John De Kumen who serves as executive vice president and. And corporate development, and those for the the just as a brief introduction, 8.4 billion market cap in DPM metals, and about 350,000 ounces of gold equivalent, over two current underground operations, and, I, I thank you, John, for, for attending the conference and for, agreeing to do the fireside chat style. So we're gonna get right into it if, if you don't mind. John, the Verus ramp up is the first, issue that, I think is, a top of investor minds. you just reported your first full quarter after restarting Verus, following the acquisition. how long, how have things been going, and what are the key milestones investors should look for, as you progress towards achieving full production? Sure, good morning. Thanks everybody for joining us. Good to see you, Ralph. Be a little while. look, it's been an excellent acquisition thus far. I think it fits very much within our sweet spot around our capabilities on, you know, underground mining. I think culturally it's been excellent. I would encourage everybody to look at our results there as we report in early May, keep an eye on the production levels. We just had a production release last week. That was encouraging to see that we continue to make progress. I think some important facets of that to pay attention to would be how do we continue to ramp up with respect to those production profiles that we outlined, moving towards 850,000 tons per year on a on a run rate. That's the sustainable level that we're looking to get to. The milestones around that are really, a couple of things. One, we've got to get that pace backfill plant up and running, that's still on, on, on track. importantly, development meterage, right? We've, I know that historically folks have been quite concerned about that. I think you'll be very encouraged about the work that we're getting accomplished there around the team, safety practices, just the efficiencies that we can learn from our chop pressure operation over in Bulgaria and you had asked also. I think culturally how's it going? We had a delegation about 3 weeks ago from the various communities of both business leaders as well as regulators visit Chelopesh for 3 days, and I, you know, I, I can't say enough about our colleagues in Bulgaria in terms of being a great ambassador and stewardship of, of the environment. they visited the mayor there in Chelopesh. it's just, it's a great opportunity to show the people, in Bosnia what we can add to the, to the equation there. And thus far, look, there's always mining's always fraught with excitement, but, we've been very pleased with the acquisition thus far. That's great. let's stick with Verus, and, and I just wanna address specifically, the pace backfill right now commissioning is set for Q3. how critical is it to these underground development rates to keep that on track, and is there a bottleneck to, to commissioning that part of the project? Yeah, no, we don't anticipate that it's gonna be a bottleneck for a couple of different reasons, but. one of the other examples of, of what we need to keep in mind as you look through the materials as we progress through the year is just that what I call the, the harmony of the instruments, right? There's the underground, there's the plant, there's the pace backfill, the tailings, that, that getting all of that in shape from a sustainable standpoint is going to be very critical for the team. And the pace-backfill plant can be a bottleneck. We don't anticipate that for two reasons. One really being the fact that it's still on, on schedule and on track. secondly, if there are any minor delays, there is the possibility of cement Rockville. And so from that standpoint, very simple. we have a plan B. at this point, we don't anticipate needing to go to plan B. let, let's drill into that a little bit more because you know part of that, asset optimization, is this $1000 to $125 million of CPE that's being spent this year, and just wondering if part of that growth if you can sort of segment that between sort of the, the rectification, the bottlenecking as opposed to growth oriented. yeah, no, it'll all, for the most part go directly into the sustainability of the operations. growth is something from the standpoint where we do have about 10 million in the budget separately for exploration to, to look at the broader land package. our perspective is that it's probably Not been well, attended to geological, from a geologist standpoint of modern exploration techniques, we'll want to continue to invest in the people, we're in the process of extracting some of the expats that are within that. So that should also help with the cost structure. and it's also very valuable in terms of just ensuring that. The Bosnians are responsible for the operations. We don't have expats in any of our Serbian or Bulgarian operations, and we really want to give them that responsibility and train them appropriately. So for example, part of that would be the expenses that are associated with going to the Chelopes operation and taking 2 to 3 weeks, if not a month or more for certain. labor and supervisory roles to learn at Chelllopesh and then take that skill set back and so that, you know, that over time then optimizes the, the, the cost structure, and it also fits more in tune with the culture of the way we approach things and that is to have local people responsible for the management, the labor of the operations. You know, part of that may be, you know, put to the test. There's a 20 day shutdown coming, I believe this quarter, Q2 for for some of the tailings and just wondering if, if, if there's any risk to that given sort of the integration, the familiarity with the workforce and, and how you're thinking about that as, as a potential risk to the sales guidance. Yeah, I think, I think the team has thus far been able to address all the key risks. We don't anticipate that that shutdown associated with mostly the filter press, but then ultimately how that fits within the whole plant package. We don't anticipate that to be over that three week period to be problematic. And we, we look, we've got a long track record of hitting our production numbers, and so I think it's, valuable for people to look back on either that, you know, that discipline, disciplined approach to how we allocate capital, but also just the disciplined approach on how we deliver. OK, great, yeah. let's switch gears a little bit to, Dimitri Potok, and, and, you recently received the exploration license approval, that you have resumed drilling in Q1 just this last quarter. what are your goals for this 20,000 m program, and do you see potential to grow that 4 million ounces, with, with a gold equivalent resource that you published just last December? Yeah, I mean, that was an excellent study to demonstrate the scale of what Dimitropotok could be. we haven't yet found the limits of that particular deposit, so that would be one of the, I guess you don't want to find the limits of the deposit, you will eventually. But, that would be one of the goals of that 20,000 m program would be to certainly continue to, flesh out in more detail both the inferred mineralization, but also, what I refer to around that intrusion as the doughnut and seeing what the full extent of that particular mineralization could be. And we certainly have expectations that it could be a fair bit more. I think it's also important that as it relates to Chocaaquita, the project. That it's another good sign as we've gotten that license renewal that it continues to demonstrate from our perspective that we want people to understand that Serbia is open for business. Choca Rikita itself, for example, was a discovery in 2022, Dmitri Potok in 2025. The government has fulfilled all of its obligations to us over that time period of following through the permitting process, and, you know, you, you really can't ask for more of that when you've got such a, an attractive, project, you know, within that gold equivalent resource we've got, substantial copper, what is specific, would you say is sort of the critical mass of copper needed before you start to pivot, you know, into more of, away from a satellite. Decision more towards stand alone. Yeah, look, I think we've already, probably got visibility to stand alone, right? The metallurgical differences between Dimitri Potok and Chocariquita are clear. Chocoaquita is probably 98+% gold, so that'll have its own processing facilities that are being, going through the process of, permitting currently. when you look at that as being sort of call it 4+ million ounces of gold equivalent, but it's a gram copper, I'm sorry, 1 g of gold and copper. it's already demonstrating that it has the ability at over 60 million tons, and if you can double something like that or triple that, that's, that's clearly standalone territory. and look, we've got the skill set both, I think technologically, around the metallurgical side as well as the mining side, because if you look at our celopesh operation, right, it's a copper gold, concentrate producer, and so it's, you know, again, right down the fairway of what our capabilities are. It's just a lot bigger. And you know you mentioned, Choca Rikita a few times. let's switch to that and talk about some of the permitting milestones that the that the projects need before starting construction. I believe the target is set for 2027. how does, you know, the, the Serbian permitting process play into that and, and compared to some of the other jurisdictions that you're facing, right, right. Well, we find that there's a lot of jurisdictional similarity between Bulgaria, Serbia, which is where Chukaorki is, and even Bosnia. a lot of these countries come from a similar background, from a permitting standpoint and just a psychological view around how they assessed mineral resources and reserves. So we see a lot of, you know, synergies or similarities as it relates to that process.hoca Riquito once again 2022 discovery through to feasibility in 2025. A very manageable size project for our balance sheet. And something then that from a permitting standpoint, right now we're currently in what I kind of call a land use type, evaluation process. It's called the spatial plan by their, their terminology. that's important because then as you identify the use of that land, that then relates to the environmental impact assessment. That's the second piece. And upon completion, which is what we anticipate by, 2027, you're then provided the construction permit. And that's why we have the confidence that we feel like as we move through that process that in 2027 that that would be full construction and that's what you see in our, growth capital that's within our three-year outlook. The majority of that growth capital that you see currently in the three-year outlook is the Chocariquita build. Got you, yeah, yeah, yeah. You know, going back to the early parts of our conversation, you talked about Chelopesh, and, and this new wedge zone is, is, I think topical on investor minds, you know what does this new high grade zone that you've discovered mean for the overall project, and how soon can you bring this into production. I just can't say enough about the exploration team. I mean they've done a fantastic job, I think, reevaluating sort of geologic themes or models, and that's really what came out of wedge. There had been historically a view with respect to the current ore body there around the copper gold mineralization that led them to want to test that wedge zone. We've not yet identified the full extent of the scale of that wedge zone. But I, what I would encourage people to look at is the grade. The grade is anywhere from 2 to 5 times what the current reserve grade is at Chelapesh. that's important because it is slightly deeper, but it does have the potential that if we can accelerate that into the M plan, which we did put out a new technical report for Chelapesh in January of this past year of 2026. it's a real opportunity to potentially feed some of that material into that mine plan. We haven't done that yet and we haven't yet found the full extent of that. and, and mineral and, and geologically, the idea is, if, if it's correct, that, that may replicate. And so is there something bigger that we might have to contemplate with the, keeping in mind that the constraints of the plant at, at roughly 2 million tons. And so does that then beg the question that you go back to regulators or how does that maybe potentially relate to what you do in terms of a bigger scale and or feeding that material that's higher grade into the mine plant? So it sounds like you're still doing the work on what it means for overall mine production in terms of scale, overall production outlook, because you're still letting the geology sort of point you where to go. But any broad strokes on what it could mean for mine life and production scale? Well, we're currently at at 10 years. I think that's a nice, you know, a nice number from that standpoint, particularly for an underground mine. We don't yet have the sense of how big the, the, you know, the tail of the tiger, how big it could be. OK, yeah, OK., you know, I'd like to maybe just pivot the conversation a little bit more towards strategic goals, more sort of higher level, and let's talk about jurisdictional concentration, you know, heavily invested in, in, in the Balkan states. How do you feel about that as opposed to, other jurisdictions that you're familiar in, in your career, Canada, the United States? Just how do we, how do we feel about the jurisdictional exposure at this point? Look, right now it's, it's, it's, it's, it's been good. I know there's a lot of concerns that we have for both people and things that are going on in the Middle East. We've been very fortunate. I think the team did an excellent job during, for example, the COVID period. We've kind of gone through this drill when it comes to supply chain, cost management, things of that nature. Bulgaria is relatively self-sufficient when it comes to things like energy, when it comes to even certain parts. They're well integrated into the European Community that I think thus far. Managed some of that energy risk, some of the supply chain risk that has not yet been problematic. But if you think about it, between Bulgaria and Bosnia, where we're at, we have this year nearly a billion dollars of free cash flow coming from an 8 hour drive. The roads between that, with the exception of Bosnia, are probably better than the roads that I drive on in the greater Denver area. There's been a lot of EU infrastructure investment. The people are well educated and so it's how do we then take that platform if we want to. Leave the general Balkans area and how do we scale that and so that's what we're looking at from the desire to continue to grow units of production. Got you, yeah, you know, sticking to the theme of, jurisdictions, you know, at this point is Loma Larga more considered within the strategy as optionality? Maybe give us a little update on how you're thinking about that. Yeah, the, the way we think about that is, look, we need to continue to think about how we preserve value there, right? We want to make sure that it doesn't distract us from the sort of the scale and the potential of what Dmitri Potok could represent, the importance of the development schedule around Serbia, and even the, you know, the track record of the operating platform that we have in both Bosnia now and Bulgaria. So while it's an important piece for us to consider how we maybe extract value from that over time. it's not something that we find that is the, you know, the focal point of the growth and the value of the company. Great, great, you know, sticking with the strategy as you look sort of more high level, I was just wondering within the cost structure, John, where you're seeing volatility? Is it in power? Is it in fuel? Is it in currencies, and what as a strategy are you doing to tackle those headwinds? Look, I think historically leading up to this Iran war conflict, it had historically been labor, right, and we've been very fortunate. We've had an excellent labor pool in Bulgaria, well educated, good motivated, well motivated people, so I'd say that that had historically probably been a concern. We've been very fortunate. Bulgaria, for example, is an exporter of electricity. being a higher grade at both in Bosnia and in Bulgaria, being higher grade, underground scale models don't have that same large open pit truck diesel requirement. So, the volatility has not yet been demonstrated, at least in our cost structure with respect to the electricity side. that is actually a higher cost component than the fuel side. but we are seeing some, added addition to what I call diesel or fuel when it comes to that in the in the EU. look, on a $1300 cost structure, it's not a significant piece of that equation. It may be $10 to $50 per ounce depending on any particular unit movement, but you know, that's less than 5% at this point. John, how are you tackling, separate issue? How are you tackling the out of tempe wind down from a personnel perspective, reallocating these resources to the best use of the company? Well, tomorrow is the last blast. It's, it's, it's a, it's a big milestone for the company. we've got a lot of eyes on that within the company. and it's, it's a, it's an interesting chapter that closes because of the chapter that it opens. The processing facilities that are at Adatepe will then be decommissioned later this year. they'll be refurbished at our relapesh operation and then they'll move on to Chocarikita and we'll use that facility, that's only about a seven year old facility. we're already training people, Serbs, on that equipment. They will assist with the decommissioning and they'll assist with the construction of that in their country and so from that standpoint we see it less as a driver on on on cost but more a driver on risk, risk management and the ability to hopefully hit the ground running much faster. Great, great and. before I turn it over to, to questions, I just wanna maybe touch on the buyback. We're sitting at $54 a share. there's, I think, a $200 million committed buyback for, for this year. how did that come about given the stock appreciation? How are you thinking about buybacks as being a priority on capital allocation? Yeah, look, we've got a long standing history of paying a dividend, and so what we use the buyback for is sort of like. a shock absorber where we see opportunities in the marketplace with respect to the value of our shares then we will have been buying back. So over the course of the last 5+ years we've taken a number of you know hundreds of millions of dollars of stock out of the market and call it even sub $20 Canadian share prices. we use that for that particular purpose as a shock absorber to maintain that dividend strategy, and we reassess that capital allocation strategy, probably every 6 months. We've just been such an excess free cash flow generator that we've had we've had to do that. It's 14 million units by what we've been allocated in terms of the TSX agreement. and so the 2200 million just represents that relative to, a particular stock price. but, we use it, we're, continuing to pay, or buy back shares during the first quarter and we'll continue to do that throughout the year. we see a lot of potential both in the various ramp up and in the Dimitri Potok scale of that particular asset. It's rare that you have in a particular jurisdiction, call it in the neighborhood of, of, of 10+ million ounce potential. And so from that standpoint, we see that we would likely continue to buy back shares. Great, great. Thanks, John. Now, I want to turn it over to the audience. If there are any questions. I think we do have a mic that may be floating, so please raise your hand if you have a question. And maybe just to conclude, last question, John, just on the dividend, 16 cents, is there a specific milestone that, that we can look for in, in terms of the capital allocation strategy on that front? Yeah, I would really point everyone's attention back to the share buyback, right? We use that. We want to ensure that we have a, a steady, predictable dividend strategy. We reinforced that at the time of the Adriatic transaction. it ends up being a little under $35 million per year, in terms of the dividend, 4 cents a 25%, 16 cents a year. we've been doing this since back into the 2020 time period, and I think it's just another, excellent example of the team's discipline around capital allocation. We said we would return capital. We said that we would generate high returns when we see, the gold price increase, and we've delivered on that. OK, great. ladies and gentlemen of the audience, please, thank me, and then, thank John for his presentation today, and, you can certainly get him on a sidebar or a one on one thing, but John and DPM team, thanks very much. Oh, I apologize, we're in trouble. Excuse me, why don't you pay more dividends and less buybacks? well, I would say that, you know, 16 cents of it's you don't even forget that you should even pay that it's worthless. Instead of having buybacks, giving real dividends. Yeah, look, I think it's a good question. we've really focused on in the last couple of years, and things have changed a lot in terms of free cash flow generation. I think we were paying dividends well before most companies of our scale were paying any dividend whatsoever, so it's a real demonstration of the quality of the ore bodies. it's a demonstration of, I think the, the management team, the board's interest to reallocate. Capital. We've been very cognizant that through the Adriatic acquisition, but also the scale of some of the exploration success that we've had over the last 3 or 4 years, that has the potential to put really good return capital into the ground to create units of production. I think we've been trying to weigh off or balance those particular needs from a cash outflow standpoint. and so that's where we've tried to use the share buyback program as a way to demonstrate that we've had that interest to at least return capital to the shareholders. Thanks for the question. Thanks, John. Thank you. Appreciate it. See you. Thank you. See you.