Pan American Silver Corp. · TSX:PAAS
Pan American Silver — Investor Presentation (October 2024)
56 slides from Pan American Silver's investor presentation, October 2024
Slide 1: Presentation October 2024
P R E S E N TAT I O N // OCTOBER 2024
Slide 2: Forward-looking statements and non-GAAP measures
2 Arena gold mine and La Arena II copper/gold development project; statements hazards inherent with the business of mining (including environmental accidents regarding strategic priorities and any anticipated benefits therefrom; expectations and hazards, industrial accidents, equipment breakdown, un
Slide 3: Cautionary notes and technical information
3 C O N T IN UED amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of “inferred NOT AN OFFER OR A SOLICITATION resources” exist, are economically or legally mineable or will ever be upgraded to a hi
Slide 4: Portfolio offers scale and quality in the Americas
CANADA 4 Head Office Timmins Dolores La Colorada Skarn Deposit // Pan American’s portfolio offers scale & quality in the Americas, MEXICO GUATEMALA where we have been operating for 30 years Escobal (C&M) • 11 producing mines1 5% • 2 catalysts with potential for material 8% 24% silver growth: La Colo
Slide 5: The go-to name for investing in silver
55 Management team experienced working in the Americas and focused on executing clearly-defined strategic priorities The “go-to” name for investing in silver with large Mineral Reserves & Resources Catalysts for material silver production growth: La Colorada Skarn, Escobal and optionality with Navid
Slide 6: Silver reserves, resources and production versus peers
6 Silver Proven & Probable Silver Measured & Indicated 2023 Silver Production (Moz) Mineral Reserves 1 (Moz) Mineral Resources 1 (Moz) 2 2 Pan American 468.0 Pan American 1,148.0 Fresnillo 56.3 Fresnillo 381.2 Fresnillo 723.7 Pan American 20.4 Coeur 243.9 Endeavour Silver 529.9 Hecla 14.3 Hecla 238.
Slide 7: Largest by market cap and most liquid silver producer
7 // Pan American is largest by market cap and most liquid of the following silver producers $100 $90 $80 $70 $60 Liquidity ($M)1 Hecla $50 First Majestic Coeur $40 $30 Fortuna Endeavour $20 Silver Silvercrest $10 Fresnillo MAG Hochschild Aya = Market Capitalization $0 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0
Slide 8: Silver price correlation and 10-year total shareholder returns
8 // Strong correlation coupled with delivery of strong total shareholder returns over 10-year period 1-Year Share Price Correlation to Silver Price 1 10-Year Total Shareholder Returns 2 Pan American 76% Aya 468% Hecla 73% Pan American 53% MAG 68% Hecla 47% First Majestic 65% MAG 23% Endeavour Silve
Slide 9: Growing industrial demand from decarbonization and electrification
9 // Growing industrial demand from global transition to decarbonization and electrification 2024E Silver Market Dynamics 1 Electrical Applications Silver Demand (Moz) 486 445 351 371 Photography & Other 322 Recycling 2% 18% Investment2 17% Silver Silver 2020 2021 2022 2023 2024F Supply Demand 1.00
Slide 10: Silver market supply and demand
10 Silver Market Total Supply and Demand (Moz Ag) 1,300 1,100 Silver (Moz) 900 700 500 2016 2017 2018 2019 2020 2021 2022 2023 2024F 2025F 2026F 2027F 2028F Total Supply Total Demand Silver Market Balance (Moz Ag) 100 0 Silver (Moz) -100 -200 -300 2016 2017 2018 2019 2020 2021 2022 2023 2024F 2025F
Slide 11: Vision and strategic priorities
11 11 // Pan American’s vision is to be the world’s premier silver mining company, with a reputation for excellence in discovery, engineering, innovation and sustainable development Focus on the safe, efficient and environmentally sound operation of our mines ➢ achieve our 2024 Operating Outlook1 ➢
Slide 12: Safety programs and initiatives
12 // Programs & Initiatives Lost Time Injury Frequency (LTIF) (1) Lost Time Injury Severity (LTIS) (2) • Implementation of the “Doing Safety Differently” initiative which 2023 0.69 2023 40 focuses on leading indicators to mitigate serious safety incidents • High Potential Incidents (HPIs) tracking
Slide 13: Operating Outlook reaffirmed
13 // Operating Outlook reaffirmed for production, Cash Costs and AISC, and capital expenditures • Annual silver production towards the low end of range • Silver and gold production heavily weighted to Q4 2024 H1 2024 2024 Full Year Actual Operating Outlook1 Consolidated Production Silver (Moz) 9.58
Slide 14: An investment grade name
14 // An investment grade name Cash + short-term Revolving investments Credit TOTAL AVAILABLE $369M Facility LIQUIDITY Cash + short-term investments of $369M $750M $1,119M3 Total debt2 of $809.5M primarily related to senior notes: $283M with 4.625% coupon maturing in December 2027 $500M with 2.63% c
Slide 15: Priorities for deployment of free cash flow
15 // Pan American adheres to the following priorities for deployment of free cash flow 1 Maintain balance sheet flexibility, with low debt ➢ Long-term Total Gross Leverage1 target of below 1.0x ➢ Company has demonstrated a disciplined approach to returning below this target, reducing debt following
Slide 16: Successful integration of new operating assets
16 // Successful integration of new operating assets and realization of synergies 404 koz ~20 Moz $1.1B $25-30M Shahuindo La Arena February 22, 2019 2018A Gold Production Silver Production Optionality(1) Total Consideration(2) Annual Synergies(3) Timmins & Bell Creek Escobal Jacobina 565 koz 9.2 Moz
Slide 17: Cost savings through synergies
17 // Pan American estimates ~$150M annually of cost savings through synergies with the successful integration of Yamana’s four operating mines and the reduction of expenses G&A (US$M) Implied Synergies = ~$60M Additional $90 million in annual cash savings following $6 $60 $94 $127 dispositions and
Slide 18: Asset sales cash proceeds and NSR royalties
18 // Received cash proceeds totaling $743.4M, plus 3 NSR royalties Entered into agreement to sell La Arena gold mine and La Arena II copper/gold development project for $245M in cash upfront, a $50M contingent payment, and a 1.5% gold NSR royalty1 Sold 56.25% stake in the MARA project for $475M in
Slide 19: La Colorada mine overview
19 Opportunities MINE OVERVIEW Ag Pb Zn Restoring mine ventilation through new, 5.3 – 5.7 Moz 5.5 metre concrete-lined ventilation shaft 2024F Ag Production1 and twin fan infrastructure (Backend Loaded) TYPE LOCATION OWNERSHIP Exploration to the east of NC2 and south Underground Mine Zacatecas, Mexi
Slide 20: Improved mine ventilation at La Colorada
20 // Significant improvement in mine ventilation conditions following on-schedule completion of new infrastructure in July 2024 Two 2,000 horsepower ventilation fans installed at the surface of the Guadalupe shaft – a 5.5 metre by 580 metre deep, fully concrete-lined ventilation shaft Click here to
Slide 21: La Colorada Skarn: exploring long-term partnerships
21 ZACATECAS, MEXICO La Colorada Skarn // Exploring long-term partnerships to develop the project Preliminary Economic Assessment 1 Highlights • Production averaging 17.2 Moz of silver, 427 kt of zinc and 218 kt of lead annually during the first 10 years • 50,000 tpd sub-level cave mine and conventi
Slide 22: Skarn mineralization in 3 zones
22 1 // Mineralization is concentrated in 3 zones, covering an area of 1,500 metres by 1,100 metres, and a depth of 800 metres to 1,900 metres below surface 1. Please refer to the NI 43-101 Technical Report dated January 31, 2024, as amended, for the Preliminary Economic Assessment of the La Colorad
Slide 23: La Colorada Skarn would rank 4th largest global silver mine
23 // Relative to 2023 mine performance, La Colorada Skarn would rank as the 4 th largest global silver mine 1,2 Largest Mines by Total Silver Production in 2023 1 (Moz) Estimated Mine Life3 2040 n.a. 2030 2033 2047 2035 2028 2027 2027 2039 41.1 Annual Production1 (Moz) 21.2 19.0 18.0 17.2 16.8 14.9
Slide 24: La Colorada Skarn would rank 4th largest global zinc mine
24 // Relative to 2023 mine performance, La Colorada Skarn would also rank as the 4 th largest global zinc mine 1,2 Largest Mines by Total Zinc Production in 2023 1 (kt) Estimated Mine Life3 2031 2031 2036 2047 2044 2033 2040 2036 2030 2042 540 485 463 Annual Production1 (kt) 427 287 262 262 208 171
Slide 25: First quartile of the zinc cost curve
25 // It would also rank in the first quartile of the cost curve Zinc Total Production Cost Curve in 2023 1 (kt, ₵ / lb) – inclusive of depreciation Production (%) 0% 25% 50% 75% 100% 200.00 Kazzinc Consolidated Dugald River McArthur River La Colorada Skarn2 Total Production Cost (¢/lb) 150.00 Rampu
Slide 26: Escobal: one of the world's best silver mines
26 SANTA ROSA, GUATEMALA MEXICO GUATEMALA // One of the world’s best silver mines Escobal • High-quality, well-built operation with over US$500M invested1 • One of the world’s largest primary silver deposits with reserves of 264 Moz • 3 consecutive years of production at 20 Moz Ag/year at AISC consi
Slide 27: Escobal license suspended pending ILO 169 consultation
27 For more information, please visit https://mem.gob.gt/derecho- // Escobal mining license suspended pending completion of an ILO 169 Consultation in Guatemala minero-escobal/ PRE-PHASE 1 PHASE 1 PHASE 2 PHASE 3 REVIEW PRE-CONSULTATION CONSULTATION SUPREME COURT VERIFICATION PAS Guatemala shall wor
Slide 28: Jacobina mine overview
28 Opportunities MINE OVERVIEW Au Mine optimization and mining method selection 185 – 203 koz 2024F Au Production1 TYPE LOCATION OWNERSHIP Excellent exploration potential to extend down- dip and along strike of known conglomerate ~8,400 tpd Underground Mine Bahia, Brazil 100% reefs 2024F Plant Throu
Slide 29: Royalties and other interests
29 ➢ Life-of-mine copper net smelter return ➢ La Bolsa Gold-Silver Project (Mexico) ➢ Pan American owns an ~11.6% undiluted royalty of 0.75% on a 100% interest in the interest in New Pacific Metals, which is MARA project with the right for PAAS to ➢ Pico Machay Gold Project (Peru) freely transfer th
Slide 30: ESG ratings and rankings
30 Reporting Frameworks and Standards ESG Ratings and Rankings 60 BBB RATING Ranked top 9th Ranked Top 50th Percentile in the Metals percentile & Mining industry Memberships and Associations Scale: 0 (worst) Scale: CCC (worst) to 100 (best) to AAA (best) 24.2 (MEDIUM RISK) Environment: 3 Ranked Top
Slide 31: A leading producer of silver and gold in the Americas
31 // A leading producer of silver & gold in the Americas $7.8 B $0.10 $80 M QUARTERLY AVERAGE DAILY MARKET CAP DIVIDEND2 TRADING VALUE3 363.0 1.9% 9 SHARES SELL SIDE DIVIDEND YIELD OUTSTANDING ANALYSTS Analyst Coverage4 Top Shareholders5 BofA Global Research (Lawson Winder) Van Eck (10.25%) Canacco
Slide 32: Appendix
PAN AMERICAN APPENDIX
Slide 33: Q2 2024 highlights
33 // Generated Free Cash Flow 1 of $102.1M Production of 4.6 million ounces silver and Adjusted earnings of $40.0M, or $0.11 220 thousand ounces gold per share2 , incl. $0.03 per share tax expense related to inflation adjustments in Argentina Silver Segment Cash Costs of $14.49 per ounce and Gold S
Slide 34: Cash flow performance
34 34 Sustaining Cash Flow Performance Growth, Business Development, and Other $700 $600 $243 $500 ($61) ($41) $403 $3 ($36) $400 $369 ($31) ($3) Millions $331 ($29) ($9) $300 $200 $100 $0 Cash and STI at Adjusted operating Sustaining capital Net changes in Dividends paid Net income tax Shares repur
Slide 35: 2024 production and cost outlook by mine
35 Silver Production Gold Production Cash Costs AISC (million ounces) (thousand ounces) ($ per ounce)2 ($ per ounce)2 Silver Segment: La Colorada (Mexico) 5.3 – 5.7 2 16.60 - 19.30 21.00 - 24.00 Cerro Moro (Argentina) 3.2 – 3.5 93 – 115 3.20 - 6.70 8.00 - 11.50 Huaron (Peru) 3.5 – 3.8 – 9.30 - 11.20
Slide 36: 2024 capital expenditures
36 Expenditures ($ millions) Sustaining Capital Project capital invested to advance La Colorada (Mexico) 22.5 – 23.0 strategic goals: Cerro Moro (Argentina) 14.0 – 15.5 Huaron (Peru) 17.5 – 18.5 • Upgrading processing plant at San Vicente (Bolivia)2 4.5 – 5.5 Jacobina Jacobina (Brazil) 53.0 – 55.0 E
Slide 37: Dividend policy and share buyback
37 Dividend Policy Share Buyback (Normal Course Issuer Bid) Pan American supplements a base dividend of $0.10 per Pan American believes that the market price of its common common share with a variable dividend, paid on a quarterly shares, from time to time, may not fully reflect the underlying basis
Slide 38: ESG structure and accountability
38 // Structure and Accountability Senior Management’s Compensation linked to ESG Performance • The Communities and Sustainable Development Committee reviews the Company’s sustainability performance and management of sustainability impacts. • The Health, Safety and Environment Committee provides pol
Slide 39: El Peñon mine overview
39 Opportunities MINE OVERVIEW Au Ag District-scale potential resulting from continued 120 - 135 koz Au exploration of the rhyolitic level 3.6 – 3.9 Moz Ag TYPE LOCATION OWNERSHIP 2024F Production(1) Continue infill drilling to confirm reserve grades Underground Mine Antofagasta, Chile 100% ~3,650 t
Slide 40: Huaron mine overview
40 Opportunities MINE OVERVIEW Ag Zn Pb Cu 3.5 – 3.8 Moz Continue development and exploration of 2024F Ag Production(1) TYPE LOCATION OWNERSHIP the Horizonte zone Underground Mine Pasco, Peru 100% ~2,550 tpd Improve electricity efficiency and lower costs 2024F Plant Throughput(1) • Huaron is an unde
Slide 41: Shahuindo mine overview
41 Opportunities MINE OVERVIEW Au Ag 122 - 144 koz Expected leach recovery increase over LOM 2024F Au Production(1) TYPE LOCATION OWNERSHIP based on metallurgical testing Open-Pit Mine Cajamarca, Peru 100% ~33,840 tpd Completion of leach pads and waste 2024F Plant Throughput(1) dumps facilities by 2
Slide 42: Timmins mine overview
42 Opportunities MINE OVERVIEW Au New tailings facility and completion of 125 – 135 koz paste fill plant at Bell Creek 2024F Au Production(1) TYPE LOCATION OWNERSHIP Exploration and development Underground Mine Ontario, Canada 100% opportunities at Whitney and deep Bell ~4,240 tpd Creek 2024F Plant
Slide 43: San Vicente mine overview
43 Opportunities MINE OVERVIEW Ag Zn Pb Cu 2.9 – 3.1 Moz Maintain consistent steady-state 2024F Ag Production(1) TYPE LOCATION OWNERSHIP production Underground Mine Potosi, Bolivia 95% ~1,030 tpd Near mine exploration on the western 2024F Plant Throughput(1) portion of the Union Vein; veins and geop
Slide 44: Minera Florida mine overview
44 Opportunities MINE OVERVIEW Au Ag Zn Ongoing exploration of the core mine down dip and laterally. Continued near- 85 – 96 koz Au site exploration to the east and at depth 2024F Ag Production(1) TYPE LOCATION OWNERSHIP where the veins are under-explored Underground Mine Metropolitan Region, Chile
Slide 45: Cerro Moro mine overview
45 MINE OVERVIEW Opportunities Ag Au Gold production is expected to increase in 3.2 – 3.5 Moz Ag Q4 2024 with the mining of the high grade 93 – 115 koz Au Naty Zone 2024F Production(1) TYPE LOCATION OWNERSHIP Possible reduction in costs will allow us to Open-Pit & Santa Cruz, Argentina 100% convert
Slide 46: Dolores mine overview
46 MINE OVERVIEW Au Ag 65 – 75 koz Au 1.9 – 2.2 Moz Ag TYPE LOCATION OWNERSHIP 2024F Production(1) Open-Pit Mine Chihuahua, Mexico 100% Production & Cost History $1,275 – $1,375 2024F Au AISC(1,2) • Dolores is an open-pit mine that produces gold and silver dore using a $2,065 Enters residual novel p
Slide 47: Navidad: undeveloped primary silver deposit
47 47 CHUBUT, ARGENTINA Navidad // One of the largest undeveloped primary silver deposits • 100% owned silver project • Project comprises 8 individual mineral deposits in 3 separate mineralized trends • Scalable production profile with high-grade mineralization at surface • Development contingent on
Slide 48: La Colorada Skarn 50,000 tpd case
48 // 50,000 tpd case Construction period 6 years Production mine life 17 years Notes: Production rate 50 ktpd (or 18.25 Mtpa) 1. Assumes metal prices of $2,800 per tonne of zinc, $2,200 per Mineable inventory 284.7 million tonnes tonne of lead, and $22.00 per ounce of silver. Average annual silver
Slide 49: Mineral reserves as of June 30, 2024
PAN AMERICAN SILVER MINERAL RESERVES 11:0: 30,202» property Location Classification ToMmes Ag Contained © Au Contained Cu Contained = Pb Contained Zn Contained (Mt) __(g/t)__Ag(Moz) __(g/t)__—Au(koz)__(%) __—Cu (kt) (%) Pb (kt) (%) Zn (kt) Escobal Guatemala Proven 25 486 39.5 0.42 34.2 - - 1.02 25.7
Slide 50: Measured and indicated resources
50 PAN AMERICAN SILVER MEASURED -INDICATED RESOURCES as of June 30, 202412 Contained Contained Au Property Location Classification Tonnes (Mt) Ag (g/t) ‘Ag (\Moz) Au (g/t) (koz) Cu(%) Pb(%) Zn (%) Navidad Argentina Measured 15.4 137 67.8 - - 0.10 1.44 - Indicated 139.8 126 564.5 - : 0.04 0.79 : La C
Slide 51: Measured and indicated resources (continued)
PAN AMERICAN SILVER MEASURED «INDICATED RESOURCES as of June 30, 202412 , ‘Ag Contained Contained Au Property Location Classification Tonnes (Mt) 27t) “agony AU (@/t) kon) cu(%) Pb (%) 20%) Jacobina Brazil Measured 39.7 1.70 2,475.1 : - Indicated 55.1 1.58 2,796.0 = 2 La Arena 11°) Peru Measured 152
Slide 52: Reserves and resources year-over-year comparison
52 as of June 30, 20231,2,3 as of June 30, 20241,2,3
Slide 53: Metal price assumptions for reserves and resources
METAL PRICE ASSUMPTIONS USED TO ESTIMATE MINERAL RESERVES & RESOURCES 5: fre 0, 2024 Mine Category Ag USS$/oz Au US$/oz Cu USS/t Pb USS/t Zn USS/t Escobal All categories 20.00 1,300 2,204 2,424 RESGRES 20.00 1,700 8,000 2,100 2,600 La Colorada Resources 22.00 1,850 9,000 2,200 2,800 La Colorada Skar
Slide 54: Metal price assumptions (continued)
METAL PRICE ASSUMPTIONS USED TO ESTIMATE MINERAL RESERVES & RESOURCES «rune 30,2024 Mine Category Ag US$/oz Au US$/oz Cu USS/t Pb USS/t Zn USS/t Reserves 21.00 1,850 Timmins West Resources 23.00 1,950 Reserves 21.00 1,850 Bell Creek Resources 23.00 1,950 Whitney Resources 1,950 Reserves 21.00 1,850
Slide 55: Mineral reserves and resources notes
55 All mineral reserves and mineral resources have been estimated in accordance with the CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended (the "CIM Standards") and reported in accordance with National Instrument 43-101 – Standards of Disclosu
Slide 56: Investor relations contact
56 Siren Fisekci VP, INVESTOR RELATIONS & CORPORATE COMMUNICATIONS +1.604.806.3191 | ir@panamericansilver.com panamericansilver.com Suite 2100, 733 Seymour St Vancouver, BC, V6B 0S6
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