Pan American Silver Corp. (NYSE:PAAS) Q1 2023 Earnings Conference Call May 11, 2023 11:00 AM ET

Company Participants

Siren Fisekci - Vice President, Investor Relations

Michael Steinmann - President and Chief Executive Officer

Ignacio Couturier - Chief Financial Officer

Steve Busby - Chief Operating Officer

Sean McAleer - Senior Vice President, Managing Director, Guatemala

Conference Call Participants

Cosmos Chiu - CIBC

Craig Hutchison - TD Securities

John Tumazos - John Tumazos Very Independent Research

Adrian Day - Adrian Day Asset Management

Don DeMarco - National Bank Financial

Operator

Good morning, ladies and gentlemen and welcome to the Pan American Silver Corp. First Quarter 2023 Unaudited Results Conference Call and Webcast. [Operator Instructions] This call is being recorded on Thursday, May 11, 2023. I would now like to turn the conference over to Siren Fisekci, VP, Investor Relations. Please go ahead.

Siren Fisekci

Thank you for joining us today for Pan American Silver’s Q1 2023 conference call. This call includes forward-looking statements and information and makes reference to non-GAAP measures. Please see the cautionary statements in our MD&A, news release, and presentation slides for our Q1 2023 unaudited results. All of which are available on our website.

I will now turn the call over to Michael Steinmann, Pan American’s President and CEO.

Michael Steinmann

Thanks, Siren and thank you everyone for joining our call today. The first quarter was transformational for Pan American with the closing of the Yamana acquisition on March 31 and to result in an increase in scale and quality across our portfolio as outlined in our recently released consolidated 2023 operating guidance. Due to the timing of closing, the addition of the Yamana assets is not reflected in our Q1 production and cost numbers, but Yamana’s cash and debt have been added to our balance sheet at the end of the quarter.

While Q1 excludes the benefits of the Yamana acquisition, our continued focus on operational excellence helped us to deliver results ahead of expectations despite ongoing inflationary pressures. In Q1, we sold nearly 4.5 million ounces of silver and 133,000 ounces of gold. Silver segment all-in sustaining costs were $14.13 per ounce and $1,196 per ounce of gold segment.

Silver segment Q1 production costs and our 2023 guidance reflect the restricted mining rates in the high-grade zone of the La Colorada mine until the new shaft ventilation project is commissioned. Thinking of the 5.5 meter diameter concrete line ventilation shaft reached a depth of 228 meters by the end of Q1 and is on track to be completed by the end of this year. The shaft will be equipped with ventilation fans connected with the adjacent deep underground East Candelaria workings and commissioned to significantly improve ventilation rates in this high-grade area of the mine around mid-2024. This new ventilation infrastructure will benefit both the long-term development of this Skarn project as well as the current vein-system operation.