Hochschild Mining (LSE:HOC) — Interim Results

0:01 Good afternoon, ladies and gentlemen, and welcome to the HOCHSCHILD MINING PLC Interim Results Investor Presentation. The company may not be in a position to answer every question received during the meeting itself. However, the company review all questions submitted today and publish responses where it is appropriate to do so. These will be available via your investor meeting company dashboard. Before we begin, we would like to submit

0:32 the following poll. And as usual, your participation would be most grateful. And I'd now like to hand over to Ignacio Bustamante. Good afternoon, sir. You very much. Good afternoon. My name is Ignacio Bustamonte, CEO of HOCHSCHILD MINING, and with me is Eduardo Noriega, our CFO, and also Charlie Gordon from our London office, head of investor relations. So if we can please move to the first slide, Charlie. So HOCHSCHILD, we define ourselves as a growing gold producer in The Americas. We have other one gold and silver mines in Peru and Argentina. We have also a very important gold project in construction in Brazil, our Mararosa project. And we have several growth options across The Americas, being the most important ones, our SNP project in British Columbia and Canada and our Volcan project in Chile.

1:22 As a reference, this year, the guidance that we have for the market is that we are going to be producing between 360,375 gold equivalent ounces with an all in sustaining cash cost of between $13.30 and $13.70. And our metal split is roughly 54% gold and 46% silver. So we're also a very important silver producer. Next slide, please. We just released this morning our financial results for the first half of the year, and the key highlights are revenues of about $348,000,000 EBITDA of $131,000,000 EPS of $01 per share, cash balance at $2.00 $4,000,000 and we have also declared an interim dividend of $0.01 $95 per share for a total of $10,000,000 Regarding our operations, our production was 166,000 ounces of gold, and we are on track to achieve our full year production target of between three hundred sixty thousand and three seventy five thousand ounces.

2:21 Regarding all in sustaining cash cost, we are at $13.71, and we also remain on track to achieve our guidance of between thirteen thirty and thirteen seventy. This, of course, is is something that is is very positive and make us very proud because in a very challenging environment, we have been able to maintain both our production and our cost guidance. So that's something that that that we believe is is is remarkable. In terms of exploration and business development, Mararosa, our project in Brazil, is on schedule. Last week, we received our key construction permit, and now we have started all the the the critical path construction work that we had planned for the year. So it's it's looking very good and on track to be completed on time and on budget. The SNP prefeasibility study is also moving along very well, and we are targeting to complete it by the end of this year, by the end of twenty twenty two.

3:13 And one of our assets in Peru, Payancata, is delivering very exciting medium term drilling results. So we're also very encouraged by that as well. So those those are the key highlights from today's presentation. If we move to the next slide, please. This is basically our growth strategy. We want to continue growing the business, and we have four pillars in which we are planning on growing the business. First one is brownfield, then we have development projects, strategic alliances, and m and a and greenfield. On brownfield, we have our flagship asset, which is in Inmaculada in Peru. It has a lot of geological potential. We have been adding resources and increasing the life of mine materially in the past few years, and we believe that we are going in a position that we can continue doing that going forward. So we view that as an asset for the for the next decades.

3:59 We also have our other asset in Peru, Pallancata that has some short term challenges, but the medium term is looking very encouraging encouraging. And our San Jose in Argentina that we also have lots of geological potential that we're going to continue to capture over time. On development projects, as I mentioned, the most important development projects is our Mararosa project in Brazil. It's a project that we completed acquisition earlier this year on April 1. And we already have all the critical permits, and we have started construction, and we expect to have it ready to begin production in the first half of twenty twenty four. On strategic alliances, we are advancing SNP, our project in British Columbia, to a prefeasibility at the end of the year, and we're also very encouraged with that, and we'll talk about that in in more detail later.

4:46 And also M and A and greenfield is an important part of our strategy with the goal of adding further projects in The Americas through either M and A or greenfield work. Moving to the next slide, please, Charlie. So on Inmaculada, Inmaculada, I mentioned, is our most important asset, has been in operation since 2015, has been in production guidance every year. We are working on the modified environmental impact statement that would allow us to have the permits to produce for the next twenty years. And we have a very large regional package that is still pending to be explored. If we move to the next slide, you're going to see in the map there the areas in in green and and light blue on the center. Those are areas where we have been focusing the most in the past that last year, for instance, only last year alone, we managed to find 850,000 polyquinone ounces with very good grades coming from three only only three veins, which are Angela North, Angela Connection, and Juliana South.

5:47 We have a 2022 drilling program subject to permits that will focus on trying to gain more ounces on that area, but also look for other areas more to the west and to the north of the deposit that we expect to drill, and we have high expectations in terms of its geological potential. Moving to the next slide. We have our other two operations, which are Pallancata in Peru and San Jose in Argentina. Pallancata is 100% owned by us. We have a strategy of adding economic ounces close to current operations. As I mentioned, the short life of mine is looking challenging with production from the current mine, but we have many options that we are going to be continue evaluating during the year with the goal of trying to extend the short life of mine as much as we can.

6:36 Outside of the permitted area, which is our our resources more for the medium to long term, we have all this area that we have identified already with veins from Laura, Demian, Royal Opata, Millian, and Marco, particularly Royal Opata and Marco that are looking really, really strong and we believe are gonna give us very attractive resources for the long term for the medium to long term in Bayancata. And, hopefully, we're gonna be in a position to quantify those before the year ends. Regarding San Jose in Argentina, we own 51% of the asset. It's an asset that has been with us since 2007, and in our view, has still plenty of potential to continue delivering us and increasing its life of mine. We have a very interesting drill program in place for 2022 that we are in the process of ex exercise executing.

7:25 And we have also other targets outside of the deposit, but in the same province, in the Santa Cruz province in Argentina that has plenty of potential that we are also in the process of evaluating, the most important one being the cyclone project. Moving to next slide, please. Talking about our Mararosa project in Brazil, it's a very high quality development asset in in Brazil. It's located in the Goias state, which is right in the center of Brazil, right next to Brasilia. It's a very mining friendly jurisdiction. We have about 80% of the digital engineering complete, and construction is already underway underway. The product economics are very robust as you can see in that table, and we are targeting production in the first half of twenty twenty four. We're also evaluating different opportunities to optimize our exploration targets and also all the project related and operational related opportunities to capture them and improve furthermore the project economics.

8:27 And as you can see there in the reserves and resources table, we have roughly 900,000 ounces of gold with roughly a 1.2 gram of gold per ton grade. No? So it's a it's a very attractive deposit, also with lots of geological potential. The main targets that we have now are Pastinho, Campos Verdes, Moro Redondo, Filos Orongo. And we have already started our brownfield plans to try to develop new resources in those areas. So we are expecting also very positive results coming coming from from Brownfield in Mararosa in the upcoming months. Next slide, please. So on 08/10/2022, so last week, we obtained the final key site clearance permit, and that has allowed us also to to start already the processing plant earthworks and civil works, the mine pre stripping, and the construction of the water reservoir.

9:28 The current the deployed assistance is currently at 9%. As I mentioned, detailed engineering is 80% complete. The long lead time equipment has already been purchased such as ball mills and filters. The three stage crusher from MEZO is also being delivered to site shortly. The construction has already begun. The mining pre streaming pre stripping is close to beginning. We're just finalizing the contracts. So we should start soon with that. And the project power line construction is already ongoing. So it's it's moving along as planned, and we're very excited and enthusiastic about this this this project. If we move to this this is a project that is also very important to HOCHSCHILD, put it in to put it in perspective. We have the reserves that HOCHSCHILD had at the end of twenty twenty one.

10:15 So with the addition of the Mararosa reserves, we are now going to be increasing our reserve base by about 56%. In terms of production, when we take into account our production guidance for the year, this is gonna represent an increase of 27% in our production. And the all in sustaining cash cost, as you can see, significantly lower than we have as an average for the company in 2022. So that should also allow us to materially improve our average cost position. So in summary, very excited with this project, and we believe it's gonna be one of our most important assets going forward with plenty of opportunities to continue growing in resources as well. On the SNP project, the the project that we have, gold project that we have in British Columbia, this is also looking really, really attractive, although it's in a in an earlier development stage.

11:07 So it's a a past producing gold property, the Golden Triangle in British Columbia, where many other projects and operations are already there. It's a very friendly mining jurisdiction. It's located in Taltan Land, Taltan Nation Land. For about ten years, in the nineties, it produced about 1,100,000 ounces with a very high grade of 10 27 and a half grams per ton. HOCHSCHILD exercised the option to start earning in 60% in October of last year from the resources. And in order to be able to to complete the earning, we need to spend about a 100 Canadian a 100,000,000 Canadian dollars over three years with the possibility of extending to a fourth year with a minimum investment of $7,500,000 per million Canadian dollars per annum. So we're in very good shape with that expenditure, and we are we we do believe that that the price is looking very attractive and that we're going to continue progressing forward, you know, in the upcoming years.

12:07 You can see the research and resources table that we have roughly combined between indicated and inferred resources about 1,600,000 ounces of gold with an average grade of about 10.4 grams. So a lot of ounces with very high grade. So this is this is looking very positive. The next one, please. So the drilling campaign commenced this year or continued. And as you can see in the table that we have show you in the previous slide, this already represents an increase of three times, more than three times of the indicated resources and an increase of about two times our inferred resources. No? So we are already seeing all the benefits of the drilling campaign and the remodeling.

12:54 We have a new drilling campaign in place this year to try to convert the not to convert, but basically to to try to confirm the the the resource and resources that we already have in order to be able to complete a prefeasibility by the end of the year. That drill has been completed. We have already received all results, and we're in the process of updating our model. And we have also started an a a campaign to identify potential resources. We have already completed four out of the five drill holes, and we're also expecting for results and and and the the the remaining drill hole to be completed to try to further understand and guide the market the upside that we see from a geological stand standpoint in this deposit. The pre facility is underway. We have already had some important achievements in q two. We have completed the metallurgical test work. We have evaluated the ARD potentially with samples.

13:48 We have already completed a flow sheet trade off study. And for q three, we are expecting to complete the processing plant design to update our resource model and to complete the TSF and the waste storage facility designs. We have a total budget for the year of $19,000,000, US dollars, which is significantly above the the minimum of 7,500,000 Canadian that I just mentioned. And there has been an increase in this budget mostly because the project is looking very positive, so we want to advance it as much as we can. And we are moving into twenty twenty two things that were initially contemplated for 2023, the most important being the environmental baseline study. Also, we want to try to accelerate the timing as much as we can. And we are fully engaged with the Taltan First Nation as well as with the provincial government.

14:37 Moving to the next slide, please. We also have a very important and large project in Chile called Volcan. Volcan is going to be part of a company of a new entity that is gonna be Tiernan Gold, a 100% owned by HOCHSCHILD, but we were to have it as a separate entity in order to look for different strategic alternatives with more freedom. It's a very, very large asset located in the Maricumba Belt in Chile, a very important area for mining in Chile as well with several projects and operations there with significant infrastructure to support the the the potential operation there. It has the potential to be a large scale mine. We acquired it ten years ago, always with the goal of it being a long term asset for the company.

15:20 By that time, we had anticipated a production or the the the previous owners had anticipated a production of 4,300,000 ounces over fifteen years. It's a very large resource base. It has about 9,000,000 ounces with about point seven grams per ton of gold. And we have been working on on the program for the year with a new CEO in place, Greg McCann, who we hired at the end of last year, who's leading all our efforts there. And we are in the process of completing the technical work to optimize the business case to we're trying to have a PEA, a preliminary economic assessment ready by the end of the year and and discuss the the the the key economics of the project and decide on next steps in terms of the strategy that we're gonna follow with this important project.

16:07 Next slide, please. So we have a very disciplined capital allocation criteria in place. First of all, we have a very focused investment. So we're invest investing only in those things that are really important for the growth strategy of the company that I described at the beginning. So we have, for instance, allocated an important part of our brownfield in out of our budget in brownfield, which in our view is the most important and and and the the best the the investment in which we can obtain the best returns because we already have those operations, are already fully permitted, fully invested, and we can increase the life of mine or improve the quality of our resources. The impact on that is going going to be really material in our balance sheet. No? And in addition to that, investing in building the growth of the company, and and the most important capital uses for that is going to be to put Mararosa into operation by 2024.

17:02 We have a very strong balance sheet. We have a very low net debt even after the Maria purchase that that costed us about $120,000,000. We have no near term debt maturities as you can see in the in the chart over there on the debt repayment schedule. And we have very strong credit lines and relationships with local banks in place that should allow us to have all the strength that we need to continue growing the business. A significant flexibility even in more complex times, now we have history of returning capital through dividends. We just announced this dividend of 10,000,000. We are maintaining our cost and production guidance despite inflation, despite all external challenges, which is something that is not that common this year in our industry. And we are able to to react in terms of silver hedges, for instance, in a time where Pallancata needed to have the financial stability to continue finding additional resources that has allowed us to continue drilling and continue continue operating the business as well.

17:59 So so if we move to the next slide, Charlie, I think that the the we can give you some views on sustainability here. Sustainability is very important for us. Actually, we just released yesterday our 2021 sustainability report. The team has done a fantastic job in putting that document together. It's on our website, so I I would really encourage you to take a look at that and and let us know if you have any comments or feedback. Sustainability is a very important part in the strategy of the company, basically based on four pillars, safety, environment, people, and culture, and communities. In terms of safety, our frequency ratio remains close to our historical lows at 1.28. Also, a similar thing with our accident severity index.

18:44 And we're basically working on making sure that our safety culture plan has a top priority in terms of training for all our people. Basically, this looks to enhance the safety culture in

18:59 all our workforce to make sure that every decision that is made takes into account safety. In terms of environment, we have our own eco score that measures our performance compared to other units and compared to compared to how we evolve over time. We have finished the the the the half of the year with 5.35 out of six, which is a very good score. And we're working on many different initiatives. The most important one's being developing the current strategy to be net zero and also on a our environmental culture transformation plan similar to a safety transformation culture transformation plan. On people and culture, we continue working on ways in which we can promote diversity in in all our operations and and units through all many many different proprietary programs.

19:45 We continue working on improving the workforce from local communities. Right now, we're at a very good number of 15%, but want to continue improving that.

19:53 Regarding communities, we continue working with them. Last year, we invested about $5,400,000 in direct investment in those communities. And through the provision of goods and services, another almost $17,000,000, we want to continue looking on ways in which we can engage with them and and and developing a a more or a stronger and longer term relationship. We're working on other initiatives that are, for instance, connectivity. We have provided with a free Internet to about 13 communities surrounding our minds, education, scholarships, and health programs as well. So a very important part of our sustainability focus as well. Moving to the next slide, please. So regarding valuation catalysts, we believe that the the stock right now is significantly undervalued.

20:42 And you can see that, for instance, in this with these couple of metrics. In terms of EV to EBITDA, we are at 1.5 times no. EV to EBITDA, while our gold peers are at 3.7 and our silver peers are

20:54 at seven times. And in terms of price to NAV, we're at point seven times compared to our gold peers at point eight and our silver peers at 1.2 times. I believe that there are very important milestones that we are gonna be seeing value pollution catalyst that we're gonna be targeting in the upcoming weeks and months that should be very important catalyst for for for an appreciation of the stock. No. One is the the decision on the on the Immacula EIA. The other one is the development of the project. No. Also, Mararosa project that that is moving along very well and be and on on on schedule, on time, and on budget. So that should also be another evaluation catalysts. We're going to continue we we expect to continue to see solid cash flows from Inmaculada.

21:40 We are going to continue investing in brownfield in all our mines, so that should also be a a value a very important value catalyst, and that that is a case for Inmaculada, for Payancata in the medium term, for San Jose as well, and also for Mararosa and SNP. We're gonna continue looking at opportunities for M and A and greenfield in The Americas. And, of course, medium term production increase, medium term cost reduction and further capital return potential. So if we go to the final slide as a summary, we believe that with the actions that the company has taken, we have really transformed the business with many growth options advanced.

22:17 Inmaculada cash flow underpinned with extensive brownfield opportunities. The Mararosa construction commenced and is on time and on budget and is looking very attractive and is going to be a fantastic addition to our portfolio. Thus, the prefeasibility study is underway and expected to be completed before the year ends. We're going to continue with our M and As and greenfield focus. We have a very robust balance sheet that is gonna allow us to to deliver on our growth plans. And, as I mentioned in last slide, a highly compelling valuation. So this this finishes the presentation. So That's great. Let's let's go to to any any questions that you may have. That's great. Ignacio, thank you very much indeed for updating investors this afternoon. Ladies and gentlemen, please do continue to submit your questions.

23:03 I just wanted the company to take a few moments to review those questions submitted already. I'd like to remind you that a recording of this presentation along with a copy of the slides and the published Q and A, will be available on your Investor Meet company dashboard, and we'll notify you when that's ready for your review.

23:16 Charles, as you can see, we've had a number of questions from investors today. And thank you to everybody for your engagement this afternoon. And please do, as I said earlier, continue to submit your questions just on that q and a tab. Type in your question, press send. But if I may, Charles, if I could hand back to you to read out the questions from investors, and then I'll pick up from you at the end. Yes. Thank you, Mark. Let's start with the first question, which really comes from from two separate questions, which are pretty similar, to to be honest. Which project do we feel offers the biggest upside for the company? So so which which project in our pipeline is is the most exciting, and what other opportunities are there beyond that as well? Yes. Thank you, Charlie. I I do believe that there's not not a single one that that that offers, you the highest. I believe that that we have a very good mix that offers offers many different alternatives, you know, and many different exciting exciting projects.

24:08 Of course, Imaculha's potential is huge, you know, and it's as it's our most important asset. It represents, you know, 70 or so percent of our of our valuation and it continues looking amazing from a geological standpoint. So I believe that the brownfield work that we continue doing at Immacula is gonna be a a future source of value creation that that will be very important for the company. Even though, no, the the market currently values or assigns no value to Payangata, no, because of the short term life of mine, I do believe that also the medium to long term potential that we are seeing in the in the in the new areas in in that are very close to the current operation that are gonna use the same the same plant, are gonna be basically using the same mining infrastructure as well. So investment is gonna be minimal, and it's looking very, very exciting in terms not only in terms of ounces, total ounces, but also in terms of the thickness of the veins and in terms of the grades of the veins. So that's something that in our view, it looks like a very, very attractive project and opportunity.

25:09 Is gonna be fantastic as well, you know, but not only because of the of the very good

25:16 fundamentals of the business in terms of production, in terms of costs, in terms of geological potential, no, which are which are looking good. So we believe that that that this project has a lot of potential to to be larger and longer than we had initially anticipated. But, also, it is it is opening up a door in a country that we believe is gonna continue giving us many, many opportunities to continue growing. And we're very excited by our first incursion in Brazil, and we believe that we're gonna be there for for a long time, not only with Mararosa, but also with many other projects there. And finally, SNP. Even though SNP is is very long term, I believe that it also opens up the possibility or a door in a new country with a fantastic jurisdiction such as Canada.

26:02 We believe that that that that project, once it gets into into into proper dimension, has the potential also to grow, has the potential to deliver us very strong production in a in a fantastic jurisdiction with very solid cash flow generation, with very good all in sustaining cash cost. So I believe that the more more medium to long term, but this project is also a represents also a fantastic opportunity for the company. Thanks, Ignacio. The next question is on supply chains. Have there been any disruption to supply chains impacting our operational performance at all? Yes. The the short answer is is no. No. Nothing that has impacted our production. We have seen some cost increases, okay, that are that are that are no. That that we have seen across the entire industry, and that has that has impacted some of our costs in our in our operations.

26:58 However, we have also seen some positives based on on cost optimization measures that we have taken that have allowed us to basically offset those those challenges that we have seen or those impacts from the supply chain consequences. So so the short answer is that that that they're having impacts, but we have been able to offset, and that's why we are in a position that we have maintained our guidance for both production and costs while that is not necessarily the case in the rest of the industry. Thank you. The next question is, would we consider share buybacks? Yes. That that's something that that is is always on the table. I would say at this point in time, we we are more focused on developing the current projects and opportunities that we have internally.

27:48 And we believe that at some point, no, sooner rather than later, the market should capture that and the price the of our stock should start reflecting all the value catalyst that that I just went through. Of course, if that were to happen, that's something that we definitely would consider. No? But at this point in time, we believe that that's something that should get corrected, you know, in the relatively short term. Thanks very much. The next question is on our view on where commodity prices are going. Yes. I I believe that this is this is not a a personal view. I believe that all the conditions for strong and hopefully stronger gold and silver prices are there, are in place. From a demand standpoint, the biggest driver for gold and and also silver continues being investment demand. And I believe that all the inflation concerns around the world and all the the turmoil that we're seeing now from a geopolitical standpoint in many in many places play very strongly to that. On top of that, silver has a lot of industrial applications in electronics, in in in medicine, in in biotechnology, etcetera, that continue picking up. No? So I believe that demand for silver is also gonna be strong from the investment value and from an industrial value as well. And in addition to that, we are seeing that the supply side is also getting very complicated. No?

29:13 It's getting harder to mine in certain geographies of the world. Permits are taking longer. Companies are investing in in finding new resources, it's becoming harder and harder to find high quality resources as well. I believe also that the supply is gonna is gonna suffer. No? So in my view, the the the mid to long term potential of gold and silver are very strong both from the supply and the demand sides. Thank you. When do we expect the drilling to be completed at SNIP? Yes. So the the drilling for the for the for proving and and doing all the the the test work, the the twin holes and the and the infill drilling that we're required to do to complete a PFS has already been completed. We have actually already received yesterday all the all the all the results. We're in the process of building the model to include all those all those results. So that is done.

30:08 What we are doing now is we are finishing the potential drilling campaign. That's to find more resources that are not or that will not be in the initial pre feasibility study to try to understand how much can this resource grow. And we we we have already completed four out of those five drill holes. We are starting this week, the remaining one. And based on that information is that we're gonna be deciding on the on the upcoming drilling campaigns. But most likely, we we will continue drilling a SNP with the goal of of of continue raising even more the resources. Thank you very much. The next question, there's a couple here really on the same subject, but given where the silver price is at the moment, can you comment on palette whether Palenkata should be put on care and maintenance?

31:00 Yes. So Payancata, as I as I mentioned earlier, Pallancata has two strategies. Pallancata has a short term strategy and a long medium to long term strategy. On the short term strategy is we're focusing on the area that is that is currently permitted, and we are looking for a different alternative from a geological standpoint that it could allow us to continue producing in the short to medium term to catch up and match with the medium to long term strategy. Okay? So we have evaluated certain areas this year. It's still not not obtaining the resources that we would expect, but we do have some encouraging areas that we are currently drilling that that we need to evaluate and that are very valid targets that could allow us to continue extending the production of Pallancata.

31:52 The way it stands is Pallancata should be operating until until early twenty twenty three. Okay? But but we're not giving a guidance yet on 2023 since we still want to continue testing the remaining valid targets that we have in place. So that is for the short term. For the long term, Payancata is looking very exciting. It's probably one of the most exciting exciting findings that we're seeing so far in the in the in the year, and it's looking very, very attractive. We're gonna be updating the market later in the year in terms of what we see there exactly, but it's looking good. So medium to long term, I would say Payanca is looking very good. Short term is a challenge, and that's why we put these hedges in place because we wanted to make sure that when the silver price was up, we wanted to not maximize the cash flow generation or minimize the loss of so that we give time to our geological team to continue evaluating these targets. I would say, if we have not been in a position to find the right target targets by the end of this year or early twenty twenty three, no, we will evaluate putting it under current maintenance. No? But but there's some time before we have to make that decision to continue testing the current targets.

33:02 Okay. And the next question is what is the current COVID vaccine status of HOCHSCHILD employees? So the percentage which are triple vaccinated. Yes. It's it's very high. It's it's close to a hundred percent. No. Depends a little bit on the jurisdictions. I think in Peru, we're already very close or at a hundred percent. In Argentina, we're a little bit bit below that. But I would say most likely a or or or the the no. An approximation is is is very close to a 100%. Great. Thank you. And then could we make a comment on the political situation in the countries we operate in, particularly Peru, and whether there are any potential legislative threats or tax increases that could be introduced. Sure. So as you probably have been following, the political situation in Peru has been complex.

33:50 We have a we have have had a lot of political turmoils in this first year of the presidency of of Pedro Castillo, which is exemplified by the number of cabinet changes and prime ministers that we have had in a very short period of time. So so the political situation is is is complex. Although, I would say, regarding the the mining sector, some of the initial concerns that were there, such as potentially closing mines or such as potentially raising taxes that sort of thing have not materialized. So I would say the perspectives now are looking better than they looked some time ago. It's uncertain what is going to happen. No.

34:36 The disapproval of the president is is is is at very low levels. The disapprovals of the congress is at very low low low levels. There is a lot of noise about a a a potential vacancy of the president, but but, you know, still, that's something that has not been has not been decided. But I would say, no. Even though the the the political turmoil remains there and most likely because of the lack of leadership will continue being there, the reality is that the the company continues operating. We have not or this has not impacted at all our production, has not impacted at all our costs, not even on the tax level. We continue moving along with our projects and permits in Peru. So so, hopefully, that situation gets resolved quickly because that will definitely give more comfort to investors to continue investing in the country.

35:25 In Argentina, the the situation is also, you know, is in a complex in a complex position. There has also been recently a change in the minister minister of economy. There are high expectations because initial measures that he has proposed look to be a right step in the a step in the right direction. But, also, I would say that the biggest challenge that we have in in in Argentina is that the the gap that continue remaining continues remaining between high inflation and low devaluation that is eroding margins. No? That you know, we got something that is not sustainable. And hopefully sooner rather than later, the government should correct that and should allow for a higher devaluation to return competitivity to the exporters in the country.

36:14 Brazil is also undergoing an electoral process, but I would say, as as for instance, in Peru or in Chile, mining is very important and and it's also very politically used. In the case of Brazil, it's an important activity, but it's not politically used. So we have seen periods in the in the history of Brazil with more socialist governments or more capitalist governments that but but the changes to the mining industry have not been material. No? So mining is industry that that that has been doing well both under different, no, under different types of government. So in our view, we we remain very calm no matter who the next president of Brazil is. We believe that they whoever gets selected will continue promoting mining in the country and and and continue seeing the importance that this sector has for for for for the country.

37:07 And it kinda, of course, not nothing more to say than very stable jurisdiction and very favorable to to to to mining, and that has not changed. That's great. Ignacio, Charles, thank you very much indeed. And I think you've addressed all the questions from investors this afternoon, and thank you once again to those that have had that engagement with us this afternoon. Ignacio, I I Charles, Eduardo, I know that investor feedback is important to the company, and I'll shortly redirect investors on the call to give you their thoughts and their expectations. But I wonder before doing so, if I may, Ignacio, just ask you for a few close closing comments, after which I'll redirect investors to give you their feedback. Thank you. Thank you very much. I mean, I I think we have covered pretty much everything in the presentation. If there's nothing else from my side other than remind you please to if you if you have the time to take a look at our sustainability report, we're very proud of that. It's in our website, and and it was just published yesterday. And the team has put a lot of effort to to convey to all all our stakeholders what we are doing on sustainability.

38:06 So so that's it. If you have any questions, feel free to contact Charlie Gordon directly at our London office, and it was a pleasure being with you this afternoon. Thank you. That's great. Ignacio, Charles, Eduardo, thank you very much indeed for updating investors this afternoon. Can I please ask investors not to close this session as we'll now automatically redirect you for the opportunity to provide your feedback in order that the management team can better understand your views and expectations? This only take a few moments to complete, but I'm sure we'll be greatly valued by the company. On behalf of the management team of HOCHSCHILD MINING PLC, we'd like to thank you for attending today's presentation. May I wish you all a very pleasant afternoon?