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Earnings call: Endeavour Mining Q1 2024 results and company updates

EditorLina Guerrero
Published 05/02/2024, 08:03 PM
© Reuters.
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Endeavour Mining (EDV.TO), a West African gold producer, reported its first-quarter results for 2024, maintaining a steady course towards its full-year guidance. CEO Ian Cockerill emphasized the company's commitment to safety, sustainable value creation, and ESG initiatives despite a decrease in production and an increase in all-in sustaining costs, primarily at the Houndé and Sabodala-Massawa mines. The earnings call also included updates on the company's exploration successes, financial position, and shareholder return program, along with the progress of various mining and development projects.

Key Takeaways

  • Endeavour Mining stayed on track to meet its full-year 2024 guidance.
  • The company reported a decrease in Q1 production and higher all-in sustaining costs.
  • First gold was delivered at the Sabodala-Massawa BIOX section.
  • Progress was made at the Lafigué development project, with first gold expected in Q2 2024.
  • Endeavour Mining has $481 million in available liquidity and a net debt position of $831 million as of Q1's end.
  • The shareholder return program has distributed $916 million to shareholders since 2021.
  • Exploration efforts extended the mineralized trend at the Assafou project by over 10%.
  • Encouraging drilling results were obtained from the Tanda-Iguela property's Pala Trend 2 satellite target.
  • A $150 million gold prepayment deal was discussed, serving as a short-term cash bridge.
  • Safety performance remained strong, with a lost time injury frequency rate of 0.11 per million hours worked.

Company Outlook

  • Production is expected to increase in the second half of the year as growth projects ramp up.
  • Endeavour Mining plans to focus on debt reduction while maintaining a robust shareholder return program in the latter half of the year.
  • The company aims to balance shareholder returns with deleveraging efforts in an updated returns policy.
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Bearish Highlights

  • Q1 production decreased by 22% compared to Q4 2023.
  • All-in sustaining costs rose due to lower production volumes.
  • The company experienced a cash outflow of $18 million due to timing issues.

Bullish Highlights

  • Endeavour Mining achieved first gold from the Sabodala-Massawa sulphide treatment plant in April.
  • The solar project at Sabodala-Massawa is expected to save approximately 13 million liters of fuel and reduce CO2 emissions by 24% annually.
  • The Ity mine saw increased production in Q1, and the Mana mine is showing progressive improvement.

Misses

  • The company did not provide specific guidance for production or costs for the upcoming quarters.
  • There is uncertainty about the longer-term structural changes in working capital.

Q&A Highlights

  • Management will stick with annual guidance and provided a rough split between H1 and H2 production.
  • No specific timeframe for the conclusion of the lilium arbitration process.
  • The company is in discussions with the new mining minister in Senegal to understand potential changes to mining laws.
  • Sustaining capital guidance includes both sustaining and non-sustaining expenditures, with no expected growth capital until another project is approved.

Endeavour Mining's Q1 performance reflects a company in transition, with several growth projects underway and a focus on operational efficiency and exploration success. The company's financial strength, with significant liquidity and a comprehensive shareholder return program, underscores its commitment to delivering value while also prioritizing safety and sustainability. As Endeavour Mining continues to navigate the challenges of lower production and increased costs, its strategic initiatives and exploration efforts signal potential for recovery and growth in the latter half of the year.

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InvestingPro Insights

Endeavour Mining's (EDVMF) first-quarter performance has been closely watched by investors seeking to understand the company's current position and future potential. Here are some insights based on real-time data and InvestingPro Tips that shed light on the company's financial health and market performance.

InvestingPro Data:

  • Market Cap (Adjusted): $5.18 billion USD
  • P/E Ratio (Adjusted) for the last twelve months as of Q4 2023: -248.89
  • Dividend Yield as of April 2024: 3.95%

InvestingPro Tips:

1. Management has displayed confidence in Endeavour Mining's future by aggressively buying back shares, a move that often signals a belief in the company's undervalued stock price.

2. The company has demonstrated a commitment to its shareholders by raising its dividend for three consecutive years, indicating a stable and potentially growing income stream for investors.

InvestingPro also lists additional tips for Endeavour Mining, including expectations of net income growth this year and a strong return over the last three months. Moreover, while analysts have revised their earnings expectations downwards for the upcoming period, they predict the company will be profitable this year.

For investors looking to delve deeper into Endeavour Mining's financials and future outlook, InvestingPro offers a comprehensive set of tips. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and gain access to a total of 7 InvestingPro Tips for Endeavour Mining, which can be found at https://www.investing.com/pro/EDVMF. These tips can provide valuable context and guidance for making informed investment decisions.

Full transcript - Endeavour Mining Cor (EDVMF) Q1 2024:

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Operator: Good day, and thank you for standing by. Welcome to Endeavour Mining’s First Quarter 2024 Results Webcast. At this time, all participants are in listen-only mode. After management presentation, there will be a question-and-answer session. [Operator Instructions] Please note that due to time constraints, we will be prioritizing questions from covering analysts. Today’s conference call is being recorded, and a transcript of the conference will be available on Endeavour’s website tomorrow. I would now like to hand the conference over to Endeavour’s Vice President, Investor Relations, Jack Garman. Please go ahead, sir.

Jack Garman: Hello, everyone, and welcome to Endeavour’s Q1 results webcast. Before we start, please note our usual disclaimer. On the call today, I’m joined by Ian Cockerill, our CEO; Guy Young, our CFO; and Mark Morcombe, our COO. Today’s call will follow our usual format. Ian will first go through the highlights of our Q1 2024 results, Guy will present the financials, and Mark will walk you through our operating results by mine before handing back to Ian for his closing remarks. We will then open the lineup for questions. I’ll now hand over to Ian.

Ian Cockerill: Thanks very much, Jack. Hello to everyone who’s on the call here today and thank you for joining us. Now, I’ve now been the Chief Executive Officer of Endeavour for just over a quarter and I’m actually pleased today to be able to report that whilst this has been a challenging operating quarter, we are still continuing to deliver against our key objectives. On the operational side, we remain on track to achieve our full year 2024 guidance and whilst production was lower in Q1 as previously guided, which drove all-in sustaining costs higher, operating performance was always strongly weighted towards H2 due to stronger performances that we are anticipating from Houndé as well as the two organic growth projects coming online. Now we’ve been focused on delivering these growth projects as they will continue to improve the quality of our portfolio and drive higher production at lower costs going forward. On Sunday, we successfully delivered first gold at the Sabodala-Massawa BIOX section, which is on budget and on schedule. That’s only two years after we launched construction. Now, and we’re also making good progress at our Lafigué development project where we’ve already started dry commissioning and we’re on track to deliver first gold in late Q2, which is a full quarter ahead of the anticipated schedule. In addition, our exploration program continues to provide us with strong platform for future growth and while we’re going to prioritize resource to reserve conversion at the moment, we’ve also delivered strong results at the Assafou deposit on the Tanda-Iguela property during Q1. And here, we continue to see the potential for the endowment of this huge cornerstone asset, it just keeps on growing very pleasingly. During the quarter, we continued to invest in growth, exploration and shareholder returns. We committed over $235 million. Our net debt position increased to as anticipated in the order of $831 million, while our leverage remained healthy, well below the 1 times net debt to adjusted EBITDA. And as our growth projects ramp up, it’s certainly going to be – we will be able to quickly delever our financial position back to well below our 0.5 times target leverage ratio. Meanwhile, we’ve made more progress on our ESG initiatives as we focus on those items that protect the places where we operate and promote sustainable socioeconomic growth in our host communities. And these will also undoubtedly support the long-term success of our business. Over the next few slides, I’ll touch upon our progress this quarter before handing over to the team for a more detailed summary. But just moving on to production and all-in sustaining cost, if we look, you can see that our quarterly production and our all-in sustaining cost trend and production in the first quarter was 219,000 ounces and that was down 61,000 ounces from the previous quarter, while naturally the all-in sustaining cost was up quite markedly to $1,186 per ounce. Now, we’d always anticipated lower production this quarter and certainly that’s flowed through into the higher all-in sustaining cost for the quarter, but not too dissimilar to that which we saw in Q1 of the 2023 calendar year. The decrease in production was driven primarily by lower production at Houndé, principally because of the strike, the unscheduled or the illegal strike which took place, as well as lower production coming out of Sabodala-Massawa. At Houndé, we mined the lower grade Kari West pit, whilst we focused on stripping at the higher grade Kari Pump and Vindaloo Main pits that will provide access to higher grade ores for the second half of this year. And that was always part of our natural sort of plan for the year. At Sabodala-Massawa, we mined lower average grades as we accelerated mining in low grade areas of the Sabodala pit as it advances towards the end of its economic life. And there’s a reason for wanting to get that out of the way. So Mark will go into a little bit more detail about what that pit is going to be used for. In addition to the expected lower production as previously disclosed, as I said, we did have that 11-day stoppage to mining and processing at Houndé in late January due to the subcontractor led strike that certainly impacted our production as well as our costs. The increase in all sustaining costs during the quarter largely is a result of a decrease in production and I’ll highlight that over the next couple of slides. Looking at the next slide, you can see the quarter-on-quarter changes in our group production. As I just mentioned, production was lower at Houndé and Sabodala-Massawa, while both Ity and Mana delivered stronger quarter-on-quarter production. Production at Ity increased and is expected to be H1 weighted due to the greater availability of higher grade ore in the first half of this year. While in Q1, Mana had its strongest quarter of production in the last 12 months due to the continued ramp up of underground mining activities in specifically in the Wona underground deposit. On Slide 9, you can see the quarter-on-quarter changes in our all-in sustaining cost. While costs went up during Q1, the main driver of the cost increase was obviously the lower gold sales and that accounted for approximately $217 per ounce higher all-in sustaining costs quarter-on-quarter and as I’ve already noted, we certainly expect our gold production to improve significantly in H2 and that will automatically drive down the all-in sustaining cost in the latter part of the year. Improvements in our mining costs partially offset the slight increases in processing costs, really that was due to increased power costs as we had to generate a lot more of our own power and slightly harder rock that we were processing. Also, sustaining capital and royalties were up this year as a result of the higher gold price. On Slide 10, I’d just like to reiterate that safety is of huge importance to us. And while we’re proud to say that our lost time injury frequency rate certainly remains at an industry leading 0.11. We were very saddened to report in February and I did report this at the year-end results, but sadly a contractor colleague had passed away in an incident at Mana mine in Burkina Faso. And I think it’s fair to say that this is absolutely a clear reminder of the need for us to retain vigilance irrespective of how good we think our safety performance is. We can never ever lose sight of the fact that we need to really focus in on our health and safety. However, in terms of production and cost, we are on track to meet our full year production and all-in sustaining cost guidance again because our performance as planned very much weighted towards the second half of the year. Moving on to Sabodala-Massawa expansion on Slide 11. We’re delighted to announce that we’ve delivered our first gold from the gravity circuit on the April 18 and pleasingly first gold from the BIOX circuit that was actually on Sunday over the weekend on the April 28. That – and this is definitely going to help improve our portfolio quality and certainly has upgraded that mine’s ability to remain a top tier operation. We are particularly proud of this achievement because having built the expansion project in only two years and we’ve delivered the project on budget and on schedule. We did that with over 3.5 million man hours worked and without any sustaining lost time injury. Now – we’re now shifting our focus to the ramp up at this particular project and we’re on track to deliver commercial production in quarter two and then get nameplate capacity from the BIOX plant of 1.2 million tonnes per annum in Q3, which should give us a full nameplate quarter of production in Q4, again supporting stronger group production and cost performance throughout the year. At our Lafigué project, we started to dry commission – the dry commissioning of the front end of the plant and we’re making good progress towards the production of first gold. Again, construction is on budget and pleasingly ahead of schedule in this case. We anticipate that we’re going to be delivering first gold towards the end of Q2, which is a full quarter ahead of the previously announced schedule. Once completed, Lafigué is going to be another cornerstone asset for the company with an envisaged annual production of more than 200,000 ounces of gold over its 13-year life and at a low all-in sustaining costs of at or around $900 per ounce. As you can see, we’re certainly pleased the construction activities in our two growth projects are now largely derisked, we have very good visibility towards increased production at lower all-in sustaining costs and significantly lower growth CapEx once this phase of growth is completed and that will lead to the turnaround in our net debt position towards the second half of this year. On Slide 13, just to give you a brief update on our ongoing exploration effort, during Q1, we launched our $65 million 2024 exploration program, but in Q1, we actually spent $25 million as we accelerated the drill program ahead of the wet season later on in the year. We’re prioritizing the conversion of resources to reserves at our key assets as well as identifying new resources at existing operations, particularly at Sabodala-Massawa, which is very much a target rich project and it’s certainly the largest exploration focus for this year and we’re going to continue with extra drilling at Assafou at the Tanda-Iguela property. Now, as we said previously, we’ve already discovered over 10 million ounces since 2021 and we’re thrilled that we remain on track to discover our target of between 12 million and 17 million ounces of indicated resource by 2025. We’re going to prioritize the cornerstone assets as well as Tanda-Iguela to make sure that we deliver on the balance of that previously stated target. Looking in a little bit more detail at Assafou, we have defined already a 4.5 million ounce resource at a grade of 2 grams a tonne. It’s one of the best discoveries in West Africa for the last decade. We discovered that for $11 an ounce within a two-year period. I’m very pleased to say that in Q1, we’ve had more positive drilling results at the deposit. We’ve identified additional mineralization along strike of the existing resources towards the Northwest as well as the Southeast. So expanding in both directions along its strike. Successfully, we’ve extended the mineralized trend by over 10% from 3.3 kilometers to 3.7 kilometers. And I think these results continue to demonstrate the prospectivity of this particular area, which we continue to aggressively explore whilst the mineralization remains open in most directions. On the wider Tanda-Iguela property, we’ve also received some encouraging drilling results, particularly at Pala Trend 2 satellite target, which is in close proximity to Assafou in the Southwest. We’ve delineated an 1,800 meter mineralized trend. We’re going to be doing more work to try to expand and extend this mineralized envelope over the remainder of the year. We’re convinced that the Assafou project will not only be another cornerstone asset for Endeavour as we advance the PFS work this year, we’re going to continue to explore the 20 kilometer long mineralized corridor and we believe that we’ll be able to discover even more resources. Turning now to Slide 15, you can see that despite our continued investments in organic growth, shareholder returns and exploration, our business continues to have low leverage with the ability to fund organic growth whilst delivering strong shareholder returns. At the end of the first quarter, we had $481 million in available liquidity. As our two growth projects ramp up in the second half of the year, we’re going to begin to focus on debt reduction to further strengthen our financial position, while still having the discipline to maintain a robust shareholder return program. On Slide 16, you can see the details of our shareholder return program and since the introduction of this program in 2021, we have returned $916 million to shareholders through dividends and buybacks, which is equivalent to $211 for every ounce of gold that we’ve produced during that period. During the quarter, we paid out $100 million in dividends, completing the final payment in our existing shareholder return program. We also paid $30 million or we spent $30 million in shareholder in share buybacks during the period continuing to demonstrate our commitment to paying supplemental shareholder returns, particularly when we see severe undervaluation in our stock, which clearly in Q1 was the case. Now, we’re well-positioned to deliver increased shareholder returns using a similar framework in the next shareholder return program, and we expect to outline details of that – towards the middle of the year, maybe in the beginning second half of the year, and we’ll come back with more details to shareholders as to what we’re going to be doing. Before I hand over to Guy, just a quick word about ESG, in January, Non-Executive Director Cathia Lawson was appointed in my place as Chair of the Board’s ESG Committee. Now, responsible mining can have a huge positive socioeconomic impact, particularly in developing and emerging economies such as West Africa. Under Cathia’s guidance, I am totally satisfied that we’re going to continue to work to deliver sustainable value for all our stakeholders in line with the best ESG practices and making sure that we comply with good governance standards. As you can see from the slide, our targets for 2024 remain ambitious and they’re aligned with our overall strategy to be a trusted partner and we look forward to reporting back on these initiatives during the course of the year ahead. With that introduction, let me hand over to Guy who will take you through the financial highlights. Guy, over to you.

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Guy Young: Thanks, Ian. Hello everyone. As Ian already mentioned, our Q1 production was 219,000 ounces, a 22% decline from Q4 last year due to lower production at Houndé and Sabodala-Massawa. While realized gold prices were 5% higher during the quarter. All-in sustaining cost was higher during the quarter largely due to the lower production and gold sales. Our adjusted EBITDA and operating cash flow before working capital also decreased given the lower production at higher costs. Adjusted net earnings were broadly in line with the last quarter, supported by lower income tax expenses in Q1 due to the timing of income and withholding tax payments through the year. Slide 20, looking at the quarter-on-quarter variations in a bit more detail, adjusted EBITDA was lower in Q1 2024 due to the lower gold sales at higher all in sustaining costs, despite the increase in realized gold price. Consequently, our EBITDA margin has decreased, but still remains at a healthy 45%. Moving on to Slide 21, you can see that whilst we enjoyed a higher realized gold price in Q1, the lower production levels and higher costs offset this, resulting in lower operating cash flows before working capital changes of $137 million or $0.56 per share. We expect this to improve significantly in the second half of the year as production increases and as our two high return growth projects ramp up. On Slide 22, looking at operating cash flow in a bit more detail. Realized gold prices increased by $96 per ounce from $1,945 to $2,041 per ounce in Q1 inclusive of gold hedges. This was more than offset by the lower gold sales of 225,000 ounces compared to 285,000 ounces in the prior quarter, resulting in the decrease in quarter-on-quarter operating cash flow. Operating expenses increased due to higher processing costs at Houndé, Sabodala-Massawa and Ity. These were as a result of increased power costs, a harder all blend and ramp up costs associated with the resign optimization initiative respectively. This was slightly offset by lower income taxes paid due to the timing of withholding tax payments and payments at Ity. An increase in the working capital outflow was driven by the timing of revenue receipts related to gold shipments, the buildup of VAT receivables and the increase in stockpile inventory at Sabodala-Massawa, Lafigué and Ity, resulting in the decrease in the quarter-on-quarter operating cash flow. Looking forward, we expect to see this working capital outflow start to unwind as VAT receipts are received at Sabodala-Massawa and once the growth projects ramp up from Q2 and start to draw down on these stockpiles, thereby reducing our inventory. Turning now to Slide 23. As previously forecasted, given the progress made on our growth projects during the quarter, our net debt position has increased to $831 million at the end of Q1. During the quarter, operating activities generated $55 million while $188 million was invested in the existing operations and the growth projects, including $30 million of sustaining CapEx, $41 million of non-sustaining CapEx and $99 million of growth capital. Financing activities were a net inflow of $88 million as the drawdown of the company’s RCF and Lafigué term loan more than offset the $100 million dividend to shareholders, $17 million of share buybacks as well as financing fees, leases and dividend payments to minorities. The group also incurred a loss of $12 million from foreign exchange measurement of cash from changes in the Euro to U.S. dollar exchange rate. Again, looking forward with our two growth projects coming online this quarter. As 2024 progresses, we expect to quickly delever the balance sheet back to a leveraged position below our 0.5 times target. We move now to net earnings. Net earnings from continuing operations were higher in Q1 2024 than in Q4 2023 due to the impact of impairments in the prior quarter, as well as lower tax expenses, lower other expenses and lower loss in financial instruments during this quarter. I’m going to avoid talking through every single line item, but just focus on a few. Firstly, the loss on financial instruments in Q1 was principally composed of unrealised losses on gold collars and forward sales and foreign exchange losses. It includes $11 million in realised losses on gold collars and forward sales as the gold price increased during the quarter. Income tax expenses decreased due to lower recognised withholding taxes due to the timing of the local board approvals for cash upstreaming, plus a lower tax expense at Ity due to the timing of our provisional payments. Adjustments included unrealized losses on financial instruments related to gold collars and forward sales and other expenses associated with the investigation on the former CEO, all of which were partially offset by the gain on sale of the Afema property and a loss on non-cash tax and other adjustments mainly related to the impact of foreign exchange remeasurements of deferred tax balances. Adjusted net earnings were stable quarter-on-quarter as lower gross earnings from mining operations were offset by lower income tax expenses. I’d now like to hand you over to Mark to take you through the operating performance. Mark?

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Mark Morcombe: Thank you, guy. and hello to everyone. Before I move into our mine-by-mine detail, I want to talk briefly about our safety performance. We have maintained an industry leading lost time injury frequency rate from continuing operations of 0.11 per million hours worked. But despite this strong safety performance, as Ian mentioned earlier, we were deeply saddened to report that a contractor colleague passed away in February as a result of injuries sustained in an incident that occurred during maintenance activities at the Mana mine in Burkina Faso. We have investigated the incident thoroughly and we will continue to reiterate the importance of adherence to our procedures, supported by periodic reassessments and task observations, as we continue to improve training and frontline supervision. As you can see on Slide 27, production in quarter one decreased by 61,000 ounces from quarter four 2023 as production at Houndé and Sabodala-Massawa was lower due to mine sequencing, with both mines expected to deliver higher production in the second half of the year. Houndé’s production was also impacted by the 11 day strike in January that led to a temporary stoppage to mining and processing. At the same time, all in sustaining costs rose by $239 during the first quarter, largely due to the lower levels of production. As lower mining costs largely offset increases in processing costs, sustaining capital and royalties. At a group level, we are on track to achieve full year guidance with improvements in performance at Houndé and Sabodala-Massawa in the second half, coupled with the production ramp up of our two growth projects, Sabodala-Massawa and Lafigué, which are expected to add incremental low cost production to the group profile. I’ll now walk through each mine starting with Sabodala-Massawa on Slide 28. Production decreased during the first quarter as we mined lower volumes of high grade ore from the Sabodala pit, resulting in lower overall head grades processed as well as lower recoveries. At the Sabodala pit, we have been accelerating mining activities so that we have the option to backfill it with tailings next year in line with our life of mine tailings management strategy. Ore from the Sabodala and Niakafiripits are providing lower grade feed, which we are supplementing with some higher grade semi refractory ore from the Massawa pits, resulting in slightly lower overall recoveries. Through the year, we expect to mine a high proportion of high grade ore from the Niakafiri, Sabodala and Kiesta pits, as well as further high grade ore from the Massawa Central Zone pit. As a result, we expect progressive improvements in performance. At the same time, we will continue to advance our $21 million exploration program that is targeted to convert existing resources into reserves, as well as identifying new refractory and non-refractory resources to support the mine plans for both the whole ore leach and the sulfide treatment plans in the near-term. Moving to Slide 29, we are delighted to announce on the 28 of April that we have achieved first gold from the sulphide treatment plant. With gold pours now completed from both the gravity and BIOX circuits. We are immensely proud to have delivered another construction project on time and on budget, with no lost time injuries after more than 3.5 million hours worked by our contractor, vendor representative and owner teams. To achieve this in only two years reflects the strength of our project construction team and the favorable operating environment in West Africa where there is a clear and well established permitting process, strong local community support, access to good infrastructure and good availability of labor. With the expansion complete, Sabodala-Massawa has significantly improved long-term outlook and highly prospective exploration opportunities as limited exploration has been focused on refractory gold in the region, particularly along the Main Transcurrent Shear Zone that runs through the property. We are confident that we’ll be able to further improve the outlook for Sabodala-Massawa through our aggressive exploration program. Moving to Slide 30, I want to quickly mention our solar project at Sabodala-Massawa. In August last year, we launched the construction of a 37 megawatt photovoltaic solar facility with a 16 megawatt battery system in an effort to significantly reduce fuel consumption and greenhouse gas emissions as well as lower power costs. This is particularly important given the SOFR treatment plant expansion, which will increase our power needs. The solar plant is expected to save approximately 13 million litres of fuel and deliver a 24% reduction in CO2 emissions each year, while reducing overall power costs by around 22% per year. The capital cost of the solar project is $55 million, of which approximately $33 million, or 59%, has now been committed with pricing in line with expectations. $12 million, or 23% of the capital cost has been incurred to the end of the first quarter, of which $7 million was incurred in quarter one alone, with a total of $45 million expected to be incurred in the full year 2024. We are on track to start commissioning later this year with the plant becoming operational early next year. Moving to the Houndé mine on Slide 31, production decreased compared to quarter four 2023, largely in line with the mine plan as we were focused on stripping activity in the high grade Kari Pump and Vindaloo Main pits during the quarter with the lower grade Kari West pit being the main source of ore feed – of ore for the mill feed. In addition, as previously disclosed, we had an 11 day stoppage to mining and processing activities from the 23 of January due to a contractor led strike. As a result, of both the mine sequence and temporary stoppage, volumes of all mine and processed decreased as did the average grade processed, resulting in lower production at significantly higher all in sustaining costs for the quarter. Despite lower production in quarter one, we expect significant improvement in the second half of 2024 as the stripping program at Kari Pump in Vindaloo Main will provide access to high volumes of higher grade ore, which will improve production and costs. For the full year, Houndé is on track to achieve its production and cost guidance. At Ity on Slide 32, production increased in quarter one in line with the mine sequence due to higher tons of ore milled as we mined an increased proportion of soft oxide ore from the Walter and Le Plaque pits. All in sustaining costs increased slightly due to a rise in processing unit costs driven by higher operating costs associated with the commissioning of the Recyn circuit. We are still continuing to commission this circuit, which should be fully operational later this year and we are progressing well with the construction of the Mineral Sizer Primary Crusher project, which should be finished in the second half of the year with the full benefit to be realized in 2025. Overall production and cost performance at Ity is expected to be half one weighted due to mining of high grade ore from Ity and Bakatouo pits ahead of the wet season and the slight impact of the wet season on processing throughput in the second half of the year. For the full year, it is on track to achieve its production and cost guidance. Moving to our Mana mine, throughout 2023 and in early 2024, we’ve been expanding the underground mine at Wona and transitioning Mana to an exclusively underground operation. As the [indiscernible] pit is expected to be fully depleted in the coming months. As you can see from the slide, performance at Mana has been progressively improving since the middle of last year, which reflects both improved mining performance in the underground mine and the progressive increase in access to production stopes as development advances. During the quarter, production increased as we mined and milled more higher grade tons of underground ore. All in sustaining costs decreased as underground mining costs improved significantly and lower sustaining capital was incurred in the Wona underground deposit. As development starts to give way to production, Mana is on track to achieve its full year 2024 production and cost guidance with costs expected to be slightly weighted towards the second half of 2024 due to the continued ramp up of underground mining activities in the Wona underground and the depletion of the higher cost Maoula open pit in half – in the first half. At the Lafigué development project, we’re making good progress towards first gold and importantly, we are still on budget and on track to deliver first gold in quarter two 2024, a quarter earlier than previously scheduled. We’re building a four million ton per annum CIL plant that will add more than 200,000 ounces of new production at all in sustaining costs below $950 per ounce over ten years, continuing to improve the quality of our portfolio and drive production growth to above 1.3 million ounces by next year. We launched the project early in quarter four 2022 and less than 21 months later we are already dry commissioning the processing plan. We have processed all through the crushing circuit with performance as expected. We are finalizing the balance of plant and ancillary infrastructure construction. At the same time, mining activities are progressing well as the fleet mobilization continues. We’ve already moved nearly 9 million tons of material and built up nearly 1 million tons of stockpiled ore to ensure a smooth production ramp up. To date, approximately $411 million or 92% of the total growth capital has been committed with pricing in line with expectations, while $321 million of growth capital has been incurred since the beginning of the project. This year’s growth capital is expected to amount to $170 million. Lafigué is expected to produce between 90,000 and 110,000 ounces at a post commercial production all in sustaining cost of $900 to $975 per ounces which is in line with the definitive feasibility study assumptions. I will now hand back to Ian.

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Ian Cockerill: Thanks, Mark and thank you Guy. I think as you’ve seen from all these preceding slides, we certainly are continuing to deliver against our top key priorities. Our operations remain on track to deliver our full year guidance with a significantly stronger H2 expected. Our two growth projects are being delivered in line with or ahead of expectations and our exploration program continues to generate value both at our near mine opportunities as well as our greenfields targets. Our robust balance sheet remains healthy and we’re moving towards a more cash flow generative phase focused on deleveraging our financial position and rewarding our shareholders. I think as people said, the famous inflection point and we are very, very close to that inflection point now. So thank you for listening everybody. I’ll now hand back to Jack and we’ll start taking any Q&A.

Operator: Thank you. [Operator Instructions] We are now going to proceed with our first question and the questions come from the line of Amos Fletcher from Barclays. Please ask your question. Your line is opened.

Amos Fletcher: Yes, good afternoon everybody. I had a few questions. First one, I wanted to ask to Guy just regarding the $150 million gold prepayment deal. Should we read that as a slightly more tax efficient way of funding future dividend flows or is there some other rationale for it? Thank you, first one.

Guy Young: Hi, Amos. Yes, sure, take it one by one. So on the prepaid, yes, you’re right, there is some advantage from a tax perspective. But I think overall, rather than see this is an overly complicated instrument. What we’re looking at is, in our view, a relatively cost effective way of bridging us between where we are today and awaiting the cash from dividends, which we’re expecting in Q4. We can, by virtue of the cost arbitrage, manage to pay down the RCF, which we’ll then do again once we’ve received the dividends in Q4. So a short term cost effective cash bridge, in essence.

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Amos Fletcher: Okay, thank you. And then second question, I guess, we’ll stick with you Guy for the time being on working capital, obviously had another reasonably sizable build during the quarter, and we’ve accumulated quite a bit over recent quarters. I guess, there’s a certain amount of that that’s going to be permanent for the new projects. So my question is, could you give us sort of roughly how much of working capital we can expect to come back by the end of this year? Thanks.

Guy Young: Sure. I think if we take a look at the overall working capital delta, $82 million of outflow is not something that we’re particularly comfortable with. So if we break that down in terms of our trade and other receivables, the delta there, which I’ll just talk in round numbers, is about 18. Both the drivers there should be temporary, and it’s based on timing more than anything else. So we’ve got gold receivables, which is really a question of cut off at the end of a quarter, and we’ve got VAT receivables. VAT receivables, we, in fact got $15 million in Senegal just after the close of the quarter. So both of those we would view as timing and temporary in nature. The trade payables, we’ve got a couple of things moving in there, but broadly speaking, we’ve got creditors being the biggest single one. And those were two relatively significant supplier payments made out of two sites, which, again, is more timing related than anything else, as is the next single biggest mover, which is in and around our payroll accruals. So this is essentially a seasonal issue where we’ve obviously built up an accrual and then we effectively pay out employee incentives. I think the key topic for us to discuss maybe going forward is going to be on stockpiles. So you might have expected, as we did, that we would be building stockpiles, particularly at Sabodala-Massawa and Lafigué. Those two are the key drivers of the cash outflow. And we would expect in H2 to be starting to draw down on both the Sabodala-Massawa and as well as the Lafigué. I think, Amos, to get any more precise at this stage is difficult. We certainly would expect an unwind of working capital in H2, but I prefer to see both of the operations up and running at nameplate capacity before we try and give you any guidance as to longer term structural changes in the working capital.

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Amos Fletcher: Okay, thanks very much. And then a final one I might ask, on the lilium arbitration. Could you just sketch out a timeframe for when you could expect this process to reach a potential conclusion, whether it’s something we can think about in months or years? Thanks very much.

Ian Cockerill: Yes, Amos, I mean, like you, we’d like to know when we could get a satisfactory conclusion to this, but at this stage, it’s very much out of our hands. It’s in the process and it will happen when it happens. Unfortunately, I’m afraid I can’t give you anything more definitive than that.

Amos Fletcher: Okay. All right, I’ll leave it there. Thanks very much.

Operator: We are now going to proceed with our next question. And the questions come from the line of Andrew Breichmanas from Stifel. Please ask your question.

Andrew Breichmanas: Thanks. Good afternoon. A couple questions from you. First, on the updated shareholder returns policy. There’s been no shortage of frameworks proposed across the sector, and I think the one that you adopted in 2021 has certainly been a success, particularly when you frame it as you have on an ounce of production basis. But in general, it seems like finding one that’s sustainable and sufficiently flexible to be adhered to seems to have been difficult. So with that in mind, you mentioned that it would be similar, but could you maybe just talk a bit more about the considerations that go into formulating that plan? In particular, how you thought the previous policy met its objectives, what additional attributes you might like to incorporate in the new one, and how you balance that with your deleveraging objectives. Thanks.

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Ian Cockerill: Yes. Andrew, I mean, to be honest with you, we’re still debating this. You’re right that the likely formulation is going to be very similar to what you had before. We believe that that formulation works in terms of giving people both a degree of certainty of a minimum payout, but importantly, sufficient flexibility as performance improves, that shareholders share in the upside of performance. So I generally am not anticipating any material diversion away from those principles. The reason for the delay is again similar to the response Guy gave in the earlier question. We just want to see how things settle down so we can then determine, what is the right sort of base level that we give to shareholders and how we would apply any sort of upside. So I would certainly want to be in a position to give more sort of details on this. Towards the middle of the year, maybe sort of July, August time, that’s when we will be coming back to shareholders.

Andrew Breichmanas: Okay, understood, thanks. My second question, I guess, relates to Sabadola-Massawa, in the press release, announcing the first gold pour from the BIOX plant, you also highlighted the exploration program that was underway at the complex, which is significant this year, as you mentioned. My recollection is that historically drilling focused on defining non-refractory resources such as Sofia. So with the BIOX circuit now ramping up, could you maybe remind us of some of the regional refractory targets and for areas such as Massawa deep, the extent to which those have been drilled?

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Ian Cockerill: Yes. Look, rather than me give you an answer here, we got Jono in the room with us. Let Jono talk to that particular point, because you’re exactly right. The emphasis certainly, now we’ve got the ability to process any type of material. It makes a lot of sense not just to focus on oxides, but also to look at the refractory, which we know, generally speaking, tends to be higher grade. But at least now we can recover it at sensible, sensible level. So Jono, why didn’t you respond to Andrew on this one?

Jono Lawrence: Thanks, Ian. Andrew, very good question. We are looking at an enlarged focus on the refractory mineralization and the primary host for that is on the MTZ structure that hosts the Massawa, deposit Massawa Central Zone and North Zone. We’ve been driving a lot of remote sensing, geophysics, soil and auger programs, which has identified very interesting structural interpretations. And that is opening up targets along the ground at 10 kilometers to the north of Massawa, which we’re in the process of finalizing drill programs to test in H2 this year. It’s a very long lead structure and it certainly has been complicated with the regolith and the weathering. But there are targets that are being developed and it’s looking very positive. Further to the southwest of the Massawa deposits, that MTZ structure bends and wraps around the Tinkoto intrusive. And that starts to sit on our exploration permits. And we are certainly doing some follow up drilling on the edge of that intrusive, as well as down to the south where the MTZ structure continues for another 20 kilometers with a minimum of work that’s been completed in the past. So very early days, very early work programs, but certainly a focus over the coming remainder of the year.

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Andrew Breichmanas: Okay, that’s it for me. Thank you very much.

Operator: We are now going to proceed with our next question. And the questions come from the line of Carey MacRury from Canaccord Genuity. Please ask your question.

Carey MacRury: Hi, good morning or good afternoon. I’m just wondering with the comment of significantly H2 weighted production. I’m just wondering if you can give us a split of what we should be thinking H1 versus H2 or some quarterly guidance going forward.

Ian Cockerill: Yes. We’re sort of looking in the range of about 60% of the production in the second half.

Carey MacRury: Okay, that’s great. Maybe one other one for me. Can you just comment maybe just on the political climate in Burkina Faso, seems like a lot of negative headlines out there. Any concerns that you have there on the impact to the mines?

Ian Cockerill: Carey, I mean, I think those of us who’ve been associated with Africa for a long time, you’re used to a reasonable degree of volatility. And I think it’s fair to say that from the beginning of the year, I wouldn’t say that the situation has either deteriorated nor has it got any better. It is what it is. We manage it. We have good interaction with the authorities. There’s still a lot of communication. So we’re not seeing any, should we call it deterioration, but yes, I mean, would we like it to be better, easier? Absolutely. But we’ve been managing the situation in the country for a while and we will continue to do so. I will – in fact, over the next couple of weeks, I’m probably going to be – going back to Burkina Faso and meeting up with the government authorities again, continuing with my normal dialogue with them.

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Carey MacRury: Okay, thanks for that. Maybe one last one if I can just with the increase in leverage, is Q1 now sort of the peak in leverage or should we expect that to kick up again maybe in Q2 or Q3?

Guy Young: Hi, Carey, Guy here. No, we’re going to expect – you can expect to see our leverage continue to increase. Our estimated peak is going to be the end of Q2 of this year. Essentially, it’s the trade off. But as we continue to generate some free cash flow we are continuing to invest quite significantly in our growth CapEx. That growth CapEx effectively gets pretty much done by the end of Q2. But it’s such significant quantum still coming at us in the second quarter that we will increase our leverage probably peaking at the end of Q2, as I say before then a relatively rapid deleverage, both in H2 and then obviously continuing into next year.

Carey MacRury: All right, that’s great. Thanks, guys.

Operator: We are now going to proceed with the next question, and it comes from the line of Anita Soni from CIBC World Markets. Please ask your question. Your line is opened.

Anita Soni: Hi. Good morning, everyone. So, can I get a little bit of color on Sabodala-Massawa, you mentioned the pit is now nearing. The Sabodala pit is now entering the end of its mine life. So would we assume that grades will continue or decline in Q2 before the ramp up at the BIOX facility?

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Ian Cockerill: What we will see there is, we will continue to bring other non-refractory pits online, so we should be able to maintain the grade profile.

Anita Soni: Okay. And then similarly, a question about Mana. If I just look at the last year pattern, like Q1 and Q4 were high in grades, but a little bit lower in the middle of the year, is that typical or are you expecting a more even spread between the grade profile?

Ian Cockerill: We’ll go down slightly in Q2, and then we will kick up again in Q3, Q4. We’ve got – at Wona, we have three different or distinct mining areas and we’ve been mining and establishing two of them. And we’re getting to the point of setting up the third one, which will come in, in the second half of the year.

Anita Soni: Right. And then lastly at ET, just thinking about the fact that it’s front half weighted, how should we think about the pattern of stockpiling and strip ratio in the first half versus the second half?

Ian Cockerill: We’ll maintain a fairly even profile. What we try to do is we just try to look at where we can get, we don’t want to be mining in the bottom of oxide pits in the wet season. So generally, the wet season or quarter three is fairly low by comparison. So if anything, we build up stockpiles in the first half of the year, and then we consume in the second half of the year.

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Anita Soni: Okay, thanks. And just to follow-up from Andrew or – sorry, I don’t know if it was Andrew, but the question about the arbitration, that was the amount that you were supposed to receive, I think was the amount to be received in Q1 around $113 million. Is that correct?

Ian Cockerill: Yes. Look, I mean, there’s $125 million, which is currently outstanding, but that – none of that has been received as yet.

Anita Soni: Okay. All right. Thank you. That’s it for my questions.

Operator: We are now going to proceed with the next question. And it come from the line of Will Dalby from Berenberg. Please ask your question.

Will Dalby: Hi, good afternoon to the Endeavour team. Thanks for your time. Just one from me on Sabodala-Massawa. Yes. I’m just trying to reconcile achieving the production guidance 360,000 to 400,000 ounces after the softer Q1. I wonder if you give a bit more granularity on the pickup in throughput and grades for the rest of the year. They’ll facilitate that catch up.

Ian Cockerill: The big difference at Sabodala is the commissioning of the BIOX plant. So we won’t expect much in Q2 as we just start the ramp up phase. But the ramp up will continue during Q3, and then we’ll hit full production during Q4.

Will Dalby: Okay. Thank you. That’s all for me.

Ian Cockerill: I think, as well, Will, I mean, the important thing to remember is with the introduction of the BIOX plant, we would anticipate improvements in overall recovery. As you know, for some time now, we’ve been putting material through the plant and the processing is so optimal because recoveries are not where they should be. But as with the BIOX coming up, we should be getting slightly better recoveries as well. So it’s a combination of better material, larger throughput, as well as better recovery. So it’s a combination of factors all coming together that are going to play out in Q3, Q4.

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Will Dalby: Okay. That’s helpful. Thanks a lot.

Operator: We are now going to proceed with our next question. And the questions come from the line of Daniel Major from UBS. Please ask your question.

Daniel Major: Hi, thanks so much. Two questions. Well, first is just perhaps following-up on some of the other questions around the cash flow profile through the year, certain items, just in terms of the cash CapEx you spent $179 million, I think in the first quarter. Can you give us a steer where that should be second quarter, and then through the second half of the year? Similar questions around cash tax distribution to minorities. How should we be thinking about those kind of payments just to try to map the profile of net debt through the year? That’s the first question.

Ian Cockerill: Hey Dan, I may not have caught the second part of the first question particularly well, but you can redirect me if I get it wrong. In terms of the cash flows, Dan, we’ve got – I think the key thing in trying to model this out would be just to try and take into consideration the very significant second quarter growth CapEx total. So we’re looking at anywhere between $150 million to $160 million, if I include solar in the number of growth CapEx in that – in our second quarter. For the remainder, we’ve seen some lumpy but relatively immaterial numbers coming through in our sustaining CapEx. But I think our overall profile would be fairly flat if you look at the general sustaining and non-sustaining. But what you do have is a front half weighted stripping and development number. You’ve got some HME, and then you’ve got the growth CapEx profile, which effectively comes to a conclusion in all material aspects by the end of the second quarter. I think the second part of the question was in and around minorities and timing. Is that right?

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Daniel Major: Yes, that’s right. Minorities and withholding tax or cash tax can be quite lumpy.

Ian Cockerill: Yes, sure. So we would effectively have Q2 with some of our provisional payments on some of our bigger sites coming through. We would then look to be declaring dividends, effectively coming out at the back end of Q3 and during Q4. And those dividend declarations will carry with them cash outflows for, obviously, withholding tax on both our portion of the minorities as well as the state portion of dividends, and then ultimately the net cash coming to us. So Q2 is basically provisional CIT, and then you’ll have withholding tax Q3, and then ultimately peaking in Q4.

Daniel Major: Okay. So both reasonable size minority dividend outflow and withholding tax in the second quarter, if we’re thinking about that net debt peak.

Ian Cockerill: Dan, predominantly CIT, so it’ll be corporate income tax in the second quarter. Withholding tax doesn’t really kick in from a cash flow perspective until the second half.

Daniel Major: Okay. All right. Thanks. And then the second question, longer-term, just on the CapEx front, if we look forward into 2025, all of your key growth CapEx will be gone. What should we be still thinking about as the sustaining and non-sustaining? So the sort of CapEx run rate once both growth projects are up and running, I think the consensus is around $300 million. Is that a reasonable number for 2025?

Mark Morcombe: Yes. As we finish the growth projects, the sort of run rate for our sustaining, non-sustaining will be in the range of $325 million to $375 million for 2025.

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Daniel Major: Great. Thanks. And final one, so the investigation has been into Sebastian’s exit has been finalized internally. Have you had any dialogue with any external agencies as to whether they need information or looking into this?

Ian Cockerill: Yes, Daniel. There’s been no communication from any external agency that we’re aware of seeking more information, so nothing has come to our attention.

Daniel Major: Great. Thanks a lot.

Operator: We are now going to take our next question, and it comes from the line of Don DeMarco from National Bank Financial. Please ask your question. Your line is opened.

Don DeMarco: Thank you, operator, and good day, Ian and team. So, first question on Houndé. The strike weighed on the quarter. Is there a potential for a relapse of the issues that caused the strike?

Mark Morcombe: We’d like to think not. There was a lot of dialogue done and it wasn’t – we did mention specifically that it was contractor led because there was a – it was one of those opportunistic one when one sort of is sort of a bit of a domino effect and people were trying to take advantage of a situation. We’ve had extensive dialogue with all contractors, our own workforce and so forth, and trying to understand what was the reasons behind it. We believe they are addressed. The situation, as – Ian as mentioned in country is fairly tenuous. And right now, I think people are taking opportunity to try and perhaps get something a little bit better for themselves and this could happen. But I think that the way that it was managed was very, very good. We did have support from government, importantly, on addressing this. And I think we’ve sort of strengthened a lot of protocols because it’s not just the striking the people and the contractors and so forth. It’s ensuring that local communities and local influence groups and so forth are all very much aware of what’s happening on the mine, so that they can’t be influenced by people on the mine to try and support their claims.

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Don DeMarco: Okay. And so given the deltas versus guidance at Houndé, what are the levers that you have to catch up over the rest of the year? We obviously, we know it’s going to be back end loaded year, but are there ways to exacerbate that and catch up?

Mark Morcombe: The main levers, and the strike is unfortunate. Q1, Q2 was always going to be lower than the second half, and the strike just exacerbated that a little bit. We are well and truly progressing on the stripping in the Vindaloo Main and the Kari Pump pits, and then we will be into the higher grade ore there in the second half of the year, and we’re confident that that will bring us through.

Don DeMarco: Okay. And Ian and Guy, I guess, to my next question, so the long-term net debt to EBITDA targets about 0.5 times, but with EBITDA fluid and it’s increasing next year, what is the magnitude of debt that you intend to repay to achieve this long-term target?

Guy Young: Don, I’ll try that. I’m not sure I’m going to get this one to exactly what you’re looking for, but we are looking at, I’m sure our debt structure, right, so…

Don DeMarco: Yes.

Guy Young: Our primary repayment is going to be against the RCF. We’ll be looking to repay that RCF as much as we can during 2024 with our upstream cash. That should take us down to not necessarily quite within our target, but closer to that target. That will be primarily the area that we will seek to continue to repay. We haven’t reforecasted or strategized around a longer – medium to long-term capital structure change at this point in time. So our primary aim is to pay down that RCF in order to get back into the target leverage ratio.

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Don DeMarco: I see. Okay. So I think the balance was about $650 million. Do you expect to repay that back in full by before, let’s say, for example, you start building Tanda-Iguela. If there’s a go forward decision on that.

Guy Young: We will continue to pay down the RCF. I think it’s a little bit too far in the future to talk about tandem for me to be able to give you any clearer direction at this stage, I’m afraid.

Don DeMarco: Okay. That’s all for me. Thank you for that and good luck with that.

Operator: We are now going to proceed with our next question and the questions come from the line of Sandeep Peety from Morgan Stanley. Please ask your question.

Sandeep Peety: Thank you, operator, and thank you to Endeavour management for taking my questions. I have a couple of them left. So firstly, coming back to the leverage point, you expect leverage to peak in 2Q. Can you confirm that prepayment of 150 was received during 2Q? And despite that, you expect the leverage to sort of peak in 2Q. And this is on top of that, you are expecting a larger withholding tax to be paid in second half of the year.

Guy Young: Sure, Sandeep. Hi there. I’ll try and take you to each one of those. So, yes, I can confirm that the prepaid were received in terms of cash in Q2. The prepaid are accounted for as deferred revenue and don’t impact our net debt. So it isn’t taken into consideration when we talk about the net debt. I think the net debt is better viewed as growth from our 831 today. We’ll take it off from whatever we can generate in terms of free cash flow, and then we’re going to add back to that leverage in terms of our growth CapEx. So the growth in our leverage to the end of Q2 is predominantly based on growth CapEx outflows. And the prepaid doesn’t necessarily come into that. And then I think the third piece was a question on the withholding tax. Yes, the withholding tax, we should see from a cash outflow perspective, being a Q3, Q4 issue. And of course, we have considered that when we’ve looked at AR [ph] cash forecasting and be when we talk to you about future leverage ratios.

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Sandeep Peety: Okay. Thank you. And then secondly, it will be very helpful if you can provide some sort of guidance on cost and production for 2Q, 3Q, and 4Q, just to better forecast. And then internally, are you baking in sort of mid-point of the production guidance range when you’re thinking for the year?

Ian Cockerill: Sandeep, we’re going to stick as we always have done with an annual guidance. We’ve told you the rough sort of split between production in H1 and H2. And to be honest with you, that’s the level of granularity that we’re comfortable with and we think is appropriate. So there won’t be any more than what we’ve already said in terms of the production as well as the cost guidance and the balance of production in H2.

Sandeep Peety: Okay. Thank you. And have you had some discussion with new government in Senegal? And are you expecting some changes to mining laws based on your discussion?

Ian Cockerill: Sorry. You’re saying, do we anticipate a change in the mining law in Senegal? Is that do you…

Sandeep Peety: Yes. Yes.

Ian Cockerill: We have not heard anything. What could we anticipate? Who knows? But we’re – I will actually be going to see the new mining minister in the next week or so. So I will certainly see what the view is. But we – bear in mind, we already have a mining convention at our operation and we would certainly hope that irrespective of any possible changes that may or may not take place, the governments would respect the existing conventions.

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Sandeep Peety: Thank you very much.

Operator: We are now going to take our last question, and the questions come from the line of Anita Soni from CIBC World Markets. Please ask your question.

Anita Soni: Hi, I just wanted to follow-up on the sustaining capital comment. I think you said it was – sorry, 325 to 375. When you say sustaining, are you talking about both sustaining and non-sustaining for that guidance?

Guy Young: Yes, Anita, that’s correct.

Anita Soni: Okay. And then just to be clear, the – you do not expect any growth capital, CapEx, on top of that, or is there anything else that you should be modeling?

Ian Cockerill: Until another project is approved, such as Assafou in the future, we have no other growth capital. We’re finishing off the solar project this year as well.

Anita Soni: Okay. And then this year’s full sustaining capital guidance was around 315. So what’s the main driver of that additional, I don’t know, I guess that’s around $60 million.

Guy Young: It’s just with Lafigué coming on Board.

Anita Soni: Okay. All right. And would that be a good sustaining capital number for Lafigué going forward as well around $60 million, or is that slightly elevated as of first year?

Guy Young: I think the best thing there is just refer to the DFS and the profile in the DFS.

Anita Soni: All right. Okay. Thank you.

Operator: We have no further questions at this time. I’ll hand back to you for closing remarks.

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Ian Cockerill: Thank you, operator. Thanks, everybody, for dialing-in, and thank you for your very interesting questions. And we look forward to seeing you at our Q2 results, half year feedback. Hopefully, we will be giving you some better news at the time. Okay. Thank you very much, indeed. Bye-bye now.

Operator: This concludes today’s conference call. Thank you all for participating. You may now disconnect your lines. Thank you.

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