Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Superior Gold's Second Quarter 2022 Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, press star two. If you have any difficulties hearing the conference, you may press star zero at any time for operator assistance. As a reminder, this conference call is being broadcast live on the Internet and recorded. I would now like to turn the call over to Mr. Chris Jordaan, President and Chief Executive Officer. Please go ahead, sir. Thank you, and good morning to everyone. Thank you for joining us to discuss Superior Gold second quarter for 2022 results. As a reminder, please refer to slide two..Of our presentation, which is posted on our website to view our cautionary language regarding forward-looking statements. In addition, please note that all amounts discussed are in U.S. dollars unless otherwise noted. Now, today, I'm joined by Paul Olmsted, our CFO, Russell Cole, our VP for Operations, as well as General Manager for Plutonic, Andrew Bigg, our VP for Business Development and Long-Term Planning, and Mike McAllister, our VP, Investor Relations. They will all participate in presenting specific parts of the presentation today. A few highlights of the second quarter of 2022 include the following. Firstly, as per our previous updates, we are developing our life of mine plan following our December 2021 resource and reserve statement release in May and subsequent lodgment of the NI 43-101 on the July 6th. As a reminder, the highlights are also further proven and probable mineral reserves increased by 66%. The ounces going to 630,000 ounces. Sorry, I just had a technical problem here. A contained gold of 3.5 grams per ton, demonstrating significant increase in the life of mine. Measured and indicated mineral resources, in terms of the mineral reserves is up 2% to 1.92 million ounces of contained gold at 3.5 grams per ton. This plan, insofar as the Life of Mine plan will include a base plan, underground expansion and other improvements. The increased resources and reserves have enabled comprehensive Life of Mine plan. We look forward to sharing those outcomes later in this year. I'd like to hand over to Russell Cole, our VP of Operations, to elaborate on the operational highlights. I'd just like to call out, there's an issue with the narrative insofar as that slide is concerned, and we'll revert back. At this point, I'd like to hand over to Russell. Thanks, Chris. As we mentioned, the Plutonic Gold Operations produced 15,096 ounces of gold in the second quarter, as compared to 19,356 ounces of gold in the same period in 2021. The decrease is largely a result of processing lower grade ore and the shift in mining activity from Plutonic East and Perch open pits to the development of the Main Pit Deeps project, which was impacted heavily by rainfall during the quarter. Operationally, we achieved a stope grade of 2.5 grams, which was slightly below our targeted grade of 3 grams per ton due to a shortage of development underground, which was in part due to higher than expected COVID-19 absence rates. Our mill grade for the second quarter of 2022 was lower than the comparable period in 2021. We expect our mill grade to improve as we progress through 2022, reflecting the impact of both higher underground grades and replacing lower grade legacy stockpile material with higher grade open pit mill feed. Gold recoveries remained strong during the quarter, second quarter of 2022 at 85%. Finally, the total ore milled in the second quarter was 13% higher than the same period in 2021, which reflects the successful mill shutdowns in Q1 and Q2. The mill is now running at 5,000 tons per day, which will support a higher production of gold in the future. I'll now hand over to Chris to recap the production and financial position. Yes. Thank you very much, Russell. I'd just like to circle back to the previous slides and highlight specific elements here. Firstly, our safety performance improved during the quarter with a 24% reduction in total injury frequency rate achieved during that period. We produced 15,116 ounces of gold and sold 16,726 ounces of gold at a realized price of $1,877 per ounce. Total cash costs resulted in $1,748 per ounce and all-in sustaining costs of $1,929 for the quarter. Cash flow from operations of $8.8 million despite the challenges that we incurred during the quarter was achieved. We ended off the quarter with a solid cash position of $18.2 million. I now would like to recap just on the improved performance of the business and operational and financial performance in 2020. While the first half of 2022 was softer due to the planned mill shutdowns, unprecedented rainfall and very high absenteeism due to COVID-19 were experienced during this period. We continue to invest in our business to deliver the company's strategy to fully optimize the underground operation. When combined with the additional new source of open pit feed, expected to positively contribute to overall profitability. We continue to target production rate towards 100,000 ounces towards the latter part of this year. Our cash position has remained strong. As I said before, at $8.2 million, representing a 4% improvement from the end of the second quarter in 2021, reflecting improved operational performance and the repayment in full of our gold loan towards the second quarter of 2021. I will now turn over to our Chief Financial Officer, Paul Olmsted, to discuss our financial results for the quarter. Thanks, Chris. During the second quarter, total revenue was $31.5 million from the sale of 16,726 ounces of gold, a decrease of $2.9 million from $34.4 million from the sale of 19,099 ounces of gold in the second quarter of 2021. Gold revenues were slightly lower as a result of 2,373 fewer ounces being sold, offset in part by an increase in the realized gold price to $1,877 from $1,801 in the prior period. Cost of sales were $31.5 million for the second quarter of 2022, an increase of $2 million from $29.5 million for the second quarter of 2021. The increase in cost of sales in the current period versus the same period in 2021 was primarily due to the variance in the change in inventory category. Change in inventory reflected decreases in the gold in circuit in the second quarter of 2022, resulting from the timing of sales versus production, the buildup of stockpile inventory, due to the planned eighteen mill shutdown in the first quarter, and the timing of production, which occurred during the first quarter of 2022. Adjusted net loss for the quarter of 2022 decreased by $3.7 million to a loss of $2 million or $0.02 per share, compared to an adjusted net income of $1.7 million or $0.01 per share in the three months ended June 30, 2021. That's primarily from operating losses of $2.5 million and net finance cost of $422,000, and that was offset by a tax recovery of $990,000. During the three months ended June 30, 2022, our cash used in operating activities before working capital changes was $156,000, a $2.7 million decrease over cash from operating activities before working capital of $2.6 million for the three months ended June 30, 2021. Decrease in cash generated from operating activities was predominantly a result of $5.3 million of lower operating earnings in the three months ended June 2022, in comparison to the three months ended June 30, 2021. Cash flow from operations after working capital was $8.8 million for the quarter, an increase of $4.1 million from the same period in 2021 before the repayment of the gold loan. As at the quarter end, the company had a strong cash balance of $18.2 million. I will now turn the call back to Chris to discuss our revised production and cost guidance. Thank you very much, Paul. We continue to carefully monitor and review operations for further potential disruptions from COVID-19 and other causes which could adversely affect our production and costs. Therefore, after a thorough operational review, taking into consideration everything that we've learned in the first half. We believe it's prudent to adjust our production guidance to a range of 69,000-75,000 ounces for 2022, an increase in all-in sustaining costs between $1,800 and $1,900 per ounce. We've taken a measured approach in this case on guidance incorporating the learnings from the year to date. In particular, operating in a COVID-19 environment and its impact on absenteeism, as well as responding to the operational challenges from unprecedented rainfall as the open pit was being reestablished. We are targeting a run rate of close to 100,000 ounces per year towards the latter part of this year in Q4, and we would expect a commensurate drop in cash costs and all-in sustaining costs for the quarter. In essence, what we're saying is that the initial plan has been delayed due to the factors that we've already identified. Our exploration expenditures range has increased year-over-year, as we ramp up our exploration efforts on new open pit targets, as well as continue with our underground programs. Moving on to the announcement of December 2021 mineral resource and reserve. I would like to hand over to Andrew Bigg, our Vice President for Business Development and Long Term Planning. Thank you very much, Chris. Effectively, what we're gonna discuss on this slide is how our increased reserves and resources has really enabled us and set us up to do a comprehensive Life of Mine plan. As you would know, we did release our resource and reserve statement at the end of May, and then we had a subsequent lodgment of our NI 43-101 in early July. Just a quick reminder, looking at the bottom right-hand of the slide there on the chart. Our reserves are up 66% at an average grade of 3.5 grams per ton. Our measured and indicated mineral resources were up 2% at an average grade of 3.5 grams per ton. Our Inferred Mineral Resources were increased by 29% at an average grade of 3.8 grams per ton. Effectively, that's really set up a great platform for us to develop a comprehensive Life of Mine plan. Now, I am pleased to report that the Life of Mine plan is on track, and the Life of Mine Plan has a clear purpose to deliver the best value plan for Superior Gold. The plan will include scenarios for value optimization, including a base plan, underground expansion, internal and external open pit feed options, including the Main Pit push-back, Hermes South, Central Bore, and other prospective targets externally and also internally. Then a large open pit development and substantial infrastructure upgrade. We will look at all the scenarios, and choose a preferred plan which offers the best value for Superior Gold. As I mentioned before, the increased reserves and resources has enabled us to embark on a comprehensive Life of Mine plan, and we look forward to sharing the outcomes at a later date this financial year. I'll now hand over to Mike, our Vice President, Investor Relations, to present on the capital structure and market end of the business. Thanks, Andrew. Slide 10 is just a quick summary of the analysts currently covering the stock, our key shareholders, and our capital structure. We're very encouraged by the support of our significant shareholders and long-term gold funds who have continued to support the stock and our story. Our average trading volume remains at levels over 200,000 shares a day across all markets. We also maintain a tight share structure with just over 123 million shares outstanding. I would also like to point out that there's just one small typo on this slide, that the cash position as of June 30th, 2022 is $18.2 million. With that, I will now turn the presentation back to Chris to recap. Thank you very much, Mike. We have a number of upcoming catalysts worth noting here. Firstly, as we've done previously, and we will continue to do so, we'll provide the market with regular underground exploration updates. Now also in addition to that, our surface exploration results. We announced the positive results of the updated resource and reserve, as Andrew has referred to previously. We expect more opportunities for improvement as we continue the full potential assessments on unlocking capacity in the operations, with a specific focus on the Life of Mine optimization now with the completion towards the end of this year in 2022. We also expect to be commencing and announcing the results of heritage surveys, which will hopefully have further positive impacts on the Main Pit push-back project and make clearer the timing of the Hermes South project. Over the next 12 months, we have a healthy pipeline of development and exploration catalysts to look forward to. Now, augmenting this is a team Andrew will lead as we intensify our focus on growth opportunities, both brownfield and external to our business. We are focused on repositioning Plutonic for long-term success and unlocking shareholder value, and we encourage you to take another look at the opportunity. Thank you. With that, I'd like to conclude the presentation portion of the call. Operator, you can now open the line for questions. Thank you, sir. Ladies and gentlemen, we will now conduct a question and answer session. If you would like to ask a question, please press star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press star followed by the number two. Your first question comes from Phil Ker of PI Financial. Good morning, everyone. Thanks for hosting the call today. Just two questions. First, I wanted to start off with the, you know, the main pit pushback. You know, since delivering the PEA, it's been fairly quiet on that front. Could you give us an update of what advancements, if any, are taking place there? Yeah. Thank you very much. We knew that the main pit pushback is gonna take some time to pull that together. You know, more specifically in so far as getting the heritage surveys done so we can allow for appropriate drill program to augment the results from the PEA. As you know, you know, more than 80% of the reserves within the PEA is only an inferred, so we need to really improve on that categorization. In so far as the project is concerned, we very well organized now and structured to give this project appropriate attention. I think at this stage, I'd like to hand over to Andrew to give you further insight as to the progress on the main pit pushback project, which we believe will be a key mainstay supply for the current mill. Yeah. Thank you, Chris. Like Chris mentioned, we have reorganized. We've onboarded a very experienced studies manager who will lead not only this study, but the collection of studies that come with our Life of Mine plan. We are progressing the heritage survey conversation. We expect to have that completed sometime in the near future. In the interim, we're obviously looking at various options for the main pit pushback. There are a number of different scenarios that can play out there. We will be looking to optimize, I guess, the resource extraction through the life of mine, and that'll give us guidance as we lead into, you know, further on the PEA as to what are the options we would like to explore in the future. Part of the Main Pit push-back, one end is a small cutback. Another end is, on the extreme end, a very large open pit which I referenced on my previous slide. There's a bit of a continuum in between those options. Phil? Okay. Appreciate the color there. That's the first act on the early entry into the main pit deeps, which is in fact mining a section of main pit pushback. It's just a much easier accessible area. What we're seeing now is that the main pit deeps would provide ore towards, which gives us a little bit more breathing space. And augmenting that would be recognizing that there's a sequence of open pits that will come online as we continue with the study on the main pit pushback. That'll be Hermes South, Central Bore, et cetera, as we progress further. There's a clear recognition that we need to fill the gap between now and the main pit pushback through other options as well. Okay. That's great color. Appreciate that. Just building on you know, the exploration kind of discussion here. Just in terms of you know, a lot of the high-grade intercepts you've put out from you know, the western and eastern mining fronts, you know, where are you at with you know, the geologic model and having enough confidence to start to wrap those new high-grade zones into a mine plan and you know, how much capital would be required? Just I guess, given the fact that some of those zones are fairly close to you know, current infrastructure. You know, just thinking. Yeah. You know, above and beyond, you know, where the mine plan could be going here. Yeah, excellent. I think that's a fantastic question. Andrew is a lot closer to this, and that's also one of the reasons why we brought Andrew in, is to run with our long-term planning. Specifically, the Life of Mine or Life of Business plan falls within his remit. I'm gonna hand over to Andrew to give you a more succinct answer to your question, mate. Yeah, thanks. Thanks, Chris, and great question, Phil. We're actually actively doing that work right now. In our previous update, we spoke about our approach to applying our geological ore body knowledge. That is giving us up-to-date feed, which we're updating our models on. We're actually just in the midst of doing mine design for Indian Access. As for your question, we've got enough information there to actually build some reserves in there and start a detailed mine design process. That is part of our active life of mine study at the moment. In terms of further exploration or the geological piece, what we have developed is we've got a clear study of what areas are more than economic, what areas in the mine are marginal, and what areas of the mine currently don't have answers to go and pursue. Given the work that we've done now, we'll have a clear plan of where we're gonna direct our exploration and in-mine exploration activities, given prospectivity and how many additional answers we need in the respective areas. We've got a very sort of formalized, logical and business returns approach to the way we're treating the Life of Mine plan. Okay. You know, I guess on a timing basis, you know, is there the potential to start to, you know, work these new zones or, you know, a couple of these new zones into the mine plan next year and, you know, into that underground sequencing? Yeah. Absolutely, there is. There is even potential to pull one or two of the easy access areas into the plan this year. However, like I said, we're literally going through the optimization process at the moment. Okay. That'll give us a clear signal of does it make sense to go in there right now, or does it make sense to go in there after we've completed a bit more development in the areas and set it up a little bit, a little bit more. Understood. Okay. Thank you. That's it for me. Right. Good question. Thanks, Phil. Ladies and gentlemen, once again, if you would like to ask a question, please press star one now. Mr. Jordaan, there are no further questions on the phone lines. Oh, pardon me. We do have a question from Ryan Hanley of Laurentian Bank. Please go ahead. Just before the buzzer there. Good morning, and thanks for taking my questions. Just wondering, just on your CapEx for the quarter here, looks like it came in at about $7.7 million all in if I take sustaining and non-sustaining. Just wondering, given the heavy rainfall and maybe some limited access to the pit, do you end up having to take on extra waste stripping that might have been above what you had initially expected at the beginning of the year? Yeah, I think that's a very pertinent question. I'm gonna hand over to Paul to field that question for us. There's certainly been impacts insofar as weather is concerned. He'll give you a little bit more insight as to what that impact is. Paul, over to you. Just a quick update on, you know, of the capital that we spent in the quarter, just a little less than half was attributable to the main pit pushback project. You're right that the strip ratio was higher, not necessarily because of the rain, but just because of, you know, the original setup. The rain effectively delayed everything from what our original anticipated entry into the main pit pushback was. In our summary of operating results for the second quarter, all of the open pit mining was attributable to that main pit pushback. You can see that the strip ratio, you know, was certainly higher for that quarter. As I mentioned, you know, we capitalized the main pit cost during that quarter. We should be seeing commercial production, you know, later, you know, in August or early September from the main pit deeps when we call that. Okay, perfect. Sorry, go ahead. Sorry, I was referring to Russell, whether you'd like to add anything. Not really. More just to back up Paul, really. Yeah, the unusual rain event, we probably ended up with about six months of the annual rainfall all in the month of May. You can imagine when we have those sorts of rain events, it really just slows down the development that we had in there. It just slowed us right down for what essentially is a little bit of a pre-strip within the pit. Unfortunately, we couldn't predict that rain event. Yep. Okay. Fair enough. I guess maybe just jumping in, jumping back to the overall CapEx. Given there wasn't any change when you did the guidance update, is it safe to assume that the capital, I guess, spending per quarter will just decline over the balance of the year to keep you within that initial range that you had put out back in January? Yes. At this point, we haven't changed our capital guidance for the remainder of the year. You know, I think that it still remains that target. I think your assumption is in line with what we would expect. Okay. Perfect. I think, another thing to that is, you know, we've really spent a lot of time and effort to appropriately gauge what capital we need to spend. There might be some capital that we moved out or capital that we canceled to try and stay within those limits. Okay. Makes sense. Maybe just one last one for me, just kinda switching gears over to the underground side of things. I think the grade that you mined out in the quarter was about 2.5 grams, and you'd already outlined the reasons and the challenges in the press release and earlier when you put out the operating results. I'm just wondering, is that target of trying to get the underground grade or the stope grade up to 3 grams still kind of the end goal? And where do you see the timing on being able to hit that number given the delays you encountered in Q2? Andrew, would you like to comment on that specifically? Because, in essence, why I'm asking Andrew to answer this question is it's primarily driven by the life of mine work that we're currently doing. We had a view today as to what the typical average grades in specific areas in the mine is, and it is significantly different in various areas, you know, where Timor is way up in the threes, these areas which are, you know, in the low twos. It's really important to understand and appreciate the work that's going into the life of mine to get an assessment as to when we will see this grade creeping up. Andrew, could you give us more insight into that, please? Thanks, Chris, and good question, Ryan. Effectively, there's a couple of knock-on effects here that we've seen in the first half. One is, as we have moved and dealt with absenteeism, development rates did slow down. We weren't necessarily developing at the pace we wanted to towards some of the stopes we had identified. We have gone through a detailed review of our H2 forecast and have a plan back on track to lift the overall grade from the underground mine. The life of mine, I mean, the sole purpose of that is to deliver the best value plan, and that includes, you know, accessing the best value ore underground early and bringing cash forward in the business. We were looking towards the end of H2 and definitely into FY2023 for that grade to lift. Okay, perfect. That's helpful. Yeah. That's. All right. That's it for me. Thank you for taking all my questions. Thank you. Mr. Jordaan, there are no further questions on the phone lines at this time, sir. Please proceed. Mr. Jordaan? Sorry. I was on mute. Apologies for that. Since there are no further questions, I would like to thank everyone for joining us today. While the second quarter was challenged, we managed some unexpected challenges and, you know, some of them are beyond our control. Certainly from a management perspective, we're trying everything we can to get back on track and to move up on that production growth trajectory that we've explained to the market already. That trajectory remains intact, albeit that it's delayed, given the challenges that we've had. Now, we will continue to advance the strategic projects necessary to reposition Plutonic for that long-term success and sustainable success, specifically on the back of a quality resource and reserve that we've been able to pull together. The life of mine will give us much more insight as to what that would look like. We expect that these improvements will drive a continued improvement in our financial performance over the course of this year and beyond. Once again, thank you everyone for joining us, and have a great day. Ladies and gentlemen, this concludes the conference call for today. Thank you for participating. You may now disconnect your lines. Thank you.
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