Hochschild Mining plc (HOC) Earnings Call Transcript & Summary

Hello, and welcome to Hochschild Mining's 2026 Interim Results Presentation. [Operator Instructions] I would now like to hand the call over to Eduardo Landin, Hochschild Mining's CEO, to begin. Please go ahead, sir.

Good morning, everyone, and welcome to our presentation of our H1 results. Here with me is Eduardo Noriega, our CFO; and Charlie Gordon in London. Charlie, please, if we can go to Page 3. Okay. Well, first, let me say that we have on H1, the strongest ever half year financials. We have produced 150,000 ounces a little bit more. Revenues went up 62%, up to $844 million. Our adjusted EBITDA went up 119% to $492 million. The EPS went up 208% to $0.37. Our attributable all-in sustaining cash cost was 2,448 per ounce gold equivalent. We end up with $309 million in cash and our net cash position is of $51 million. The dividend that we have established following our policy is $0.04, equivalent to $21 million. What do we have to do with the rest of the second half? Well, Mara Rosa reorganization is on track. We will talk about during this presentation. Royropata, the environmental permit was submitted to the Peruvian government at the day that we plan to do so. We continue working on the Monte de Carmo on engineering and the decision of the FID will be at the end of the year. We continue having a strong ESG metrics, and we have also reviewed our all-in sustaining cash costs for the end of the year, and the new range is between $2,380 8 to $2,500 per ounce. Basically, the reasons for this review is being FX in the different countries that we operate. and also the price, the gold and silver price that affect directly to word profit sharing and royalties, for example. So I mean the guidance stays in terms of production stay as it was defined at the beginning of the year. And the all-in sustaining cash cost is the figures that I just gave it to you. Okay. I pass the presentation to Eduardo Noriega to go through the financial results. So Charlie, if you can go on to Page 5, please. Go ahead, Eduardo.

Thank you very much, Eduardo, and good morning. So this strong set of financial results, as Eduardo described as a record half year results are mainly characterized by strong metal prices, but also strong operations and the recovery of our operational capabilities in Brazil Revenue was up 62%, and it was mainly driven by higher prices, gold and silver prices that was partially offset by scheduled lower houses produced. Cost of sales went up 11%, mainly due to, as I said, schedule higher tonnage, including waste movement in Mara Rosa to recover our operational capabilities. We also had the impact of higher prices in royalties, workers profit-sharing, export tax in Argentina and other items directly correlated to prices. And also, we saw stronger local currencies in Peru and Brazil and net inflation in Argentina. I would say all those effects are closely tied to the stronger gold and silver prices. In terms of administrative expenses, the increase is versus last year is mainly driven also by the performance of the company prices impacting LP, but also over to profit sharing and bonus provisions. In others, we recorded a higher adjustment to our mine closure provisions of $6 million and also the impact of higher prices on some items in other expenses like the social contribution that we have in Argentina. Finally, tax rate, the effective tax rate was 35%, mainly including special mining taxes. And the FX appreciation in Brazil and Argentina, special mining taxes and royalties are in Peru, sorry, and also the impact of FX movements in Brazil and Argentina. Excluding these effects, our effective tax rate would have been 32%. We didn't record any exceptional items in the first half of the year. If we can go to the next page, please, Charlie. Here, we have a cash evolution, and I would just like to start saying that the free cash flow was very strong in the year and account for around $16 million. in total. You can see the cash that we were able to generate in Inmaculada and San Jose, very strong, the first 1 at $288 million, a second $149 million. In Mara Rosa, we used $18 million to fully recover our capabilities and build a thickener, install a thickener and open the beat. We invested $16 million in brownfield exploration. Our corporate overhead was $30 million. In terms of tax paid, we paid $129 million from which most of it is in gold went to Peru and Argentina. We reduced debt by $80 million. We paid $84 million in dividends, $26 million to Hochschild shareholders and the rest $58 million to our joint venture partner in San Jose, McEwen mine. We had temporary movements in working capital negative of $37 million. We executed our current maintenance and enclosure budgets, but invested $17 million we paid net interest of $8 million. In addition to these elements, we invested in Mote de Carlo, $9 million in our permitting process -- sorry, in our engineering process. In Royropata $6 million. In Aclara, we made a capital of $9 million in Q1, and we had other investments in $3 million, mainly the expenses that our -- the Tiernan company investing in the organ projects. So with that, our ending balance of cash and short-term investments was $309 million. Again, a very strong free cash flow generation in the first half of the year despite having temporary movements like the working capital and also I didn't mention, but in the tax line, around $80 million were taxes that belong to the previous year 2025 that were paid in March and in May, the regularization of the tax. If we can go to the next page, please, on cost drivers in the all-in sustaining cost at the hog operation was $ 2,448 per ounce. In Inmaculada, the cost was $1,983 per ounce, and that cost included the impact of the scheduled lower grades, but also the impact of higher prices in worker profit sharing and other items of the cost. We also had a stronger solid local currency in Peru, which had an impact and we had scheduled sustained CapEx increases mainly to develop new areas and do execute our infill drilling program. In San Jose, our all-in sustaining cost was $2,944 -- and those -- that cost include the impact of lower grades from the border areas that we're mining and also the impact of higher prices in royalties and export taxes. We also observed a local net inflation -- local net inflation in Argentina, we were expecting more a devaluation, but we saw in this first half, a net inflation of around 7%. In the case of Mara Rosa, the all-in sustaining cost of $3,551 per ounce is -- includes the -- all the efforts and investment that we have made to recover to successfully recover operational capabilities in the country. And also in Mara Rosa, we also had the impact of the stronger real versus the U.S. dollar. I would like to highlight that the company has made strong efforts implementing a cost reduction and efficiency projects that has helped us mitigate the impact of general inflation in the mining industry associated to higher metal prices. Again, a very good performance. And as Eduardo pointed out, I just would like to reiterate that the adjustment that we have done to our values between in cost guidance is mainly associated to higher prices and the direct impact in our all sustaining costs and also the impact of stronger FX rates locally and net inflation in Argentina. All the rest of the inflationary pressure have been offset by our efficiency projects. We can go please to the following page on capital expenditures. We have maintained our guidance of between $210 million and $225 million for the year. In the first half, we invested $105 million in sustaining CapEx on a consolidated basis. In Inmaculada, we invested $69 million, and this number mainly include mine developments and projects and the expansion of the tailings done where we invested $10 million. We also executed our infill drilling campaign and other support CapEx. In the case of San Jose, our CapEx was $5 million, mainly related to mine development. And in the case of Mara Rosa, the $21 million invested in the first half is mainly associated to all the programs that we explained before to recover the mine operational capability is mainly the thickener but also the opening of the pit. On the following page, please, on the balance sheet. We had $309 million in cash and short-term investments, as stated before, -- and the cash generation of $156 million free cash flow is reflected in our -- the transformation of our position by the end of $25 million or $20 million to a net cash position of $51 million. The interim dividend went up 300% to $0.04 per share. And our net cash to last 12 months EBITDA was minus -- sorry, the net cash was 0.1x much below our target of between 5x and 1.5x net debt to EBITDA, in preparation for the investments where we are scheduled to do in Monte do Carmo and Royropata. Back to you Eduardo.

Thank you very much. Charlie, we can go to Page 11. Okay. Just to remember, what we defined 3 years ago, it was a strategy that pursue the delivery and to reach the growth. Basically, we defined 4 pillars. The first one was brownfield to bring long-term value, basically expanding our life of mines in each of the sites that we operate. also to be focused on resources that would end up mineable, it's not -- it's important to bring mineable resources. -- and also to continue expanding our land packages in all the countries that we operate to maximize the chances to bring new resources. On the operational excellence, of course, we have a lean philosophy across the company, looking for cost efficiencies -- also would like to go by the book on the project development. That's why we are working on Monterrat the moment. And of course, it's very important for us to be on the sites and to have a leadership that is present with the people. On ESC, we need to continue to focus on safety. Safety is the most important thing for us -- but of course, as you know, water is something that is very delicate today in the world. So we like to focus on water management. As you know, we -- 3 years ago, we implemented a new community approach, especially in Peru. I mean the result has been that no blockages or whatsoever during the 3 years. And of course, talent management. And on the Fourth pillar is the disciplined capital allocation where we are looking to produce capital returns to our shareholders. But of course, through our balance sheet, we need to fund in organic growth -- so also to be able to pay debt. And of course, if we do any M&A, this money has to be value accretive. If we can go to the next page, please. Two years ago, also, we classified the assets on core assets and noncore assets. So today, we are focused on our 3 core assets, which is Inmaculada, Mara Rosa and San Jose. We also focus on the projects that we have on the near term, Monte do Carmo, Royropata, and also, we have been working very hard on getting value out of those noncore assets. And the best samples you have is the Tierman Gold today and Aclara has a value of $300 million and Crespo, Azuca and Arcata was sold. If we go to the next page, please. As Eduardo Noriega mentioned, we need to be very focused on cost and looking for efficiencies Today, we have more than 50 initiatives in place to be able to control or to offset the inflation that we are living in the mine industry. And that inflation has been able to set -- I mean, to set off with these initiatives. So the only reason why we have reviewed the new guidance caused new guidance is because without the effects and also the price related cost -- in this page, you can see different top initiatives that they have been implementing in each site. We believe that we will be able to achieve the guidance in terms of cost and also in terms of production applying these programs. Going to Inmaculada, on Page 14, please. Charlie, Inmaculada, as you know, is our flagship operation. The guidance in -- for 2026 is between 134, -- 174,000 to 185,000 ounces of gold -- and we are -- I mean, we are in that path to be able to achieve these results. Sadly, I have to say that we have a contractor fatality in June, but we have done an extensive investigation on what happened and apply all the lesson learned from this situation. Also, I would like to mention that, as you can see, the production profile, it goes a bit down, yes. But I have to say that this is the -- I mean, the results of having higher prices that led you pass through the planned lower grades. If we go to the Page 15, I mean this is -- Inmaculada been a fantastic story. We started Inmaculada back in 2015. And if you remember, we used to have 1 million ounces of gold equivalent it was 80 million ounces of silver equivalent. In the last 10 years, we have been able to discover an veins and bring a total resource of 5.2 million ounces of gold. What is next in Inmaculada? Well, Inmaculada, we are trying to do exploration at the south of the deposit. That is something that we haven't yet. Also, Minascucho, we just got the permit, and we are waiting for social permitting that's at the northwest of the deposit. We have found Eduardo well, some new pains that could be potential resources in the next years. And also, we believe that we will be able to bring around 250,000 ounces this year or infer resources. But as you can see, I mean, this year, our focus is to try to bring potential resources, potential new areas to be able to expand again the resource Inmaculada. Going to Page 16, we have Royropata project. We have a great new here and is that we have been able to file the environmental permit with the new Peruvian government. Also, as you know, I mean, we have been able to build this document. We have worked with specialist consultants. We closed our agreements with the communities back in 2024. And to be, we believe that we have a year of revision we will be seeing the permit granted next year around AAs. That's the plan. I mean the thing about Royropata is that we have 3.3 million ounces of gold equivalent. As you can see, the grade is 412 grams of silver and 1.5 grams of gold. And the average width of the deposit is 30 meters. Also, you know that we have a plan of 3,000 tonnes ready to receive this material at our Selene plant that is incurred maintenance since 2023. So we believe that we have a huge value to bring to the company, developing this new project. And also if we can go to the next page, you can see that we brought a lot of resources from 2007 to 2025, but between 2027 and 2030, we believe that we can look for new resources to extend Marco vein. Good news for the company. It is that we just got the semi-retail permit that let us drill from 40 platforms and we are going to target the extension of Pallancata vein and also the new areas that we believe that we can bring new resources. So I believe that -- in a couple of years, we can have a new fantastic asset that will complement the production in Peru with at least 100,000 ounces per year. If we go to Page 18, you can see our land package between Inmaculada and Pallancata and Selene. It's 152,000 hectares is a huge land package. We have been able to add 6 million ounces of coal equivalent to date. And we are using the most advanced exploration tools that are available in the market. The latest thing that we are doing is micro gravity survey. We are testing current veins with these models, and we believe that there is a very good correlation. So between this micro gravity and also the long hauls drilling, we believe that we have the tools to explore all this area and continue bringing resources to our plants and Inmaculada and Selene. Okay. Going to Page 19. We fly to Brazil to Mara Rosa. Mara Rosa, as you know, it was an asset that we acquired in Brazil, our first asset. During 2025 and 2026, we have been working on a reorganization and finally, we have finished that. We have sold all the filtering issues. We have a new contractor in place. And our guidance, we keep our guidance for 2026, between 67,000 and 80,000 ounces. If we go to the next page, I believe that the most interesting thing is the graph at the bottom of the page, the run rate performance. And as you can see, in August, we have the crushing in and filtering plants billing to our nameplate capacity. Good news is that we were able to implement the sticker that now is fully commissioned and working in record time in 3 months. And the most important thing is that today, we come with a very competent mining contractor, and we are doing many, many improvements at the mine. So I believe that the second half of Mara Rosa going to be very good for the company. I mean, we have finished all this work. If we can go to Page 21, Charlie, please. You can see the open pit there. You can see the filters. You can see the dry stack on the right upper corner of the page. That is, I mean, state-of-the-art in terms of stability and everything. The thickener in place, you see the ore stockpile full of water and also the filtering plant with their ceilings ready for -- I mean with the roofs ready for the rainy season. If we go to Page 22, we can see the Mara Rosa near-mine program to add new resources. As you know, I mean, the place where Posse, which is Mara Rosa, is placed is a organic trend that extends for 20 kilometers and we have many mining concessions along this trend. Currently, we are evaluating a structural corridor with 3 structures, Posse, Araras and Speti. And we believe that we have promising results from drilling at the North of Posse. I mean the idea is to continue bringing as we establish in our strategy is continue bringing new resources to current assets. If we can go to Page 23, we can see Monte do Carmo. Monte do Carmo is our new project in Brazil that we acquired in 2024 for $60 million is 1 million ounces of gold. It's located in a very mining-friendly Tocantins state, which is north of Goias. I mean this project is fully permitted. And I have to say that has an excellent infrastructure in terms of paid highways, hydropower plants, airports, cities, big cities, that I'm sure you will attract very good talent once we start the operation. Today, we are working on waste rock facilities are pre-stripping engineering, going to detail engineering. The plant engineering done by Ausenco is nearly finished. Of course, we continue doing some pile drilling -- and of course, we have been able to talk to suppliers in order to talking about the orders for mining, crushing, power lines and filtration -- to make sure that the lead times of those equipments are ready for us. We expect to present to the market and update the economic and go to our Board of Directors for FID at the end of this year. And I mean, at that point, we will have finished 100% of our basic engineering. And through H1 2027, we will go I mean, to perform the detail engineering of all the components. Basically, once you have a basic engineering you can apply a fast construction strategy, developing detailed engineering during construction that idea. But I mean, I really do the first thing is to make sure that based on basic engineering, we have a very strong project even at very conservative prices. That also does also is established on our strategy to make sure that any M&A has to be value accretive. And in San Jose, San Jose is doing very well in terms of production. Unfortunately, I mean, inflation has went down in Argentina. Today, we have up to 16 -- but unfortunately, we didn't have any valuation. So I mean, cost is increasing. And it's incredible how many efficiency projects we have done in order to control those costs. But I mean 16% of cost increase is a lot. So I mean, we believe that we will be able to finish the year inside the new ranges that we have presented to the market. And of course, be able to accomplish with our guidance. In terms of exploration, if we can go to Page 25, I mean we believe that San Jose has -- still has a lot of potential in terms of new resources. In 2026, we have been drilling in spares West in Ayelen and Maura. We are also doing microgravity survey that has been complete, 70% in areas that we believe that we could have new resources. And of course, also, we are working at the San Jose province where we have some mining properties, and we believe that we can bring more value to the content. Okay. Changing the subject. If we go to Page 26, I believe that we have -- I mean we talk with the new Peruvian government. As you know, we have elections on July 28, and Keiko Fujimori was appointed as a new president in Peru. I have to say that a new cabinet has been a point, and I would say that it's technical and investment friendly. At the inaugural address, [indiscernible] Center basically on restoring stability, confidence and growth, we believe that these early moves that give us signals of continuity and pragmatic market orientated tonne. On the economic team, we are very happy because Julio Velarde has been reappointed to the Central Bank. You know that the Peruvian sol has been the most establish effects in Latin America. This -- Julio Velarde will continue as a governor of the Central Bank has decided to extend his leadership until 2031. Also, as a ministry of economy, Elmer Cuba has been a appoint. He is a macro economies, very well-reputed respected macroeconomies and also former Central Bank Director. We expect to have a growth of 3.5% GDP in 2026. I -- the mining and energy minister, Guillermo Shinno, has been appointed as a minister. He used to be Vice Minister of Mines -- and it's a person that has a lot of experience on the private sector also. And I believe that the Fujimori platform for the -- for our sector is try to formalize mining, tackle illegal mining and also simplify permitting. So I believe that why it's important this news for investors is because I mean we have an improvement sentiment we renew expectations to have faster permitting. I'm sure that the country is going to be attracting new investments. And so I mean, I know that permitting remains challenging overall because, I mean, we need to have -- I mean, we need to implement a lot of changes on regulations that the Fujimori's government has presented. But I mean, of course, we have the Royropata pyramid now with this government, and I believe that that's very good news for the company. I insist that Royropata is -- it could be the new flagship of Hochschild mining, and we need to continue developing this project. If we go to Page 27, again, I mean, this slide is always on our presentation is that we believe that we have a valuation opportunity -- now we have Mara Rosa that I believe that OSI is going to perform. I macular continues having a very strong performance -- and today, Royropata, we have already presented the permit and Monte do Carmo, we believe that at the end of the year, we are going to be able to present the FID. So with all these news, if we compare ourselves with our peers, we have still a very low value. So that's an opportunity to buy our share -- and the expectation is that the value is going to grow in the future. If we go into Page 27, as a conclusion, well, 2026 H1 has been as we said, a record performance in terms of financial I'm extremely happy with the execution that we have been able to implement at Mara Rosa in its turnaround. We have very strong Peruvian and Argentina in cash flows -- the dividend is going to be $21 million. And also, as we established in our strategy, children and car investments now are valued at more than $300 million. I mean, what is coming is Monte Cabo project advancing with FID, as I explained, we believe that our brownfield program will deliver new additional ounces Road project to deliver more than 100,000 ounces gold equivalent, started production in 2028. And of course, we will be keeping our disciplined capital allocation strategy to make sure that we pay debt that we have the cash to continue investment for sure to give returns to our shareholders. With this, I have finished the presentation. And of course, please I would like to open the Q&A session. Thank you so much for being here today.

[Operator Instructions] My first question is from Richard Hatch from Berenberg.

Just I've just got 3 financial questions for Eduardo. Please, the first one is just Eduardo, on the administrative costs, they picked up because of bonus provisions, what should we expect those costs [indiscernible] as we go into the second half of the year? And that's the first one. Second one is just on the working capital. So you see working capital over H1 in of about $45 million. I just wonder if you could help us how we should think about working capital in H2? And then thirdly, just on cash tax, what kind of cash tax number should we be modeling for H2 '26?

Richard, on admin expenses, I would expect a same amount for the second half. I mean I would say that the most important impact here is workers' profit sharing. You know that in Peru, around 8% of the profit before income tax is shared among employees. So that has had a rate impact on admin expenses. And then the rest of the items are pretty much -- should be pretty much similar to what we saw in H1 this year. In terms of working capital, certainly towards the end of the year, we typically see an improvement on working capital. You see that we had a negative movement of $37 million in the slide that I presented -- so I think that, that amount should be offset in the next -- in the second half of the year. And finally, on -- I don't know -- I could not hear you very well on the tax. But I'll take the tax payments that we had in the first as was were $129 million from this $129 million, part of it around $70 million were regularization of 2025 taxes in the offline taxes executed in March and May this year. So it's included in here. For the second half, we may see, excluding those $70 million, we should see a similar amount, probably a little bit higher because there are more prepayments that are made in the second half versus the second in the second half versus the first half, also pretty much a similar number, a little bit higher, excluding the $70 million that I pointed out.

[Operator Instructions] We have a question from Ian Russouw from Barclays.

Yes, a few questions from me. Can you guys hear me?

Very well, yes.

Perfect. Yes. Just firstly, on the dividend. Obviously, you said you paid the dividend in line with your policy, but if I look at your apply the policy that you, I guess, showed the reconciliation of the full year results. If I apply that to H1 numbers, I get dividend sort of per share significantly higher than what you declared. So how should I think about the interim dividend? It doesn't seem like you exactly applied your policy for that versus, I guess, what you did for the full year? And then the second question, just on Monte to Karma. It seems like your -- there's obviously been a bit of a delay in the time line for the FID over the last couple of years, I guess, more than a 12-month delay, but you've never really changed the first production time lines, Eduardo, you just mentioned, I guess, perhaps fast-tracking construction. But how should we think about that and the risks of that first production figure? And I guess if you are only doing detail engineering later than previous plan, does that sort of introduce additional risks for the project and for the scope and time lines, et cetera?

Okay. Well, basically, what we need to build modular, I believe that is between 18 months and 24 months, yes. So I mean, once you have basic engineering, you can go and hire contractors. That's usually the use back in 2015 at Inmaculada. I mean, I did it with 60% basic engineering. In this case, we do have 100% basic engineering. Of course, we can fast track all the single work I mean, all the civil detail engineering. And also, I have said that we are talking with the suppliers of the main equipment also to make sure that the lead times are in line with our expectations. So I believe that taking into account all these numbers and all the data, we could be able to start production at the end of 2028. That's the situation.

Thank you, Eduardo. Let me address in questions on thank you for being that question, Ian. So our policies and annual policy, we said that we were going to distribute between 20% and 30% of the attributable free cash flow. So basically, you need to deduct the non-attributable portion of the free cash flow of Argentina, basically, in summary, that is what this is about. And when looking at the interim dividend, we -- what you should do is we're not expecting to pay to apply that same policy to the first half -- we're actually looking at the overall -- the entire year modeling for different scenarios on prices, prices could stay will go up, -- so we save some room for that situation. So that's how we discuss the H1 numbers. And of course, we listen to market and see where we are and try to meet both objectives. The first one, important one, I want to follow the policy, the annual policy. And the second 1 is pay event that we would protect us from an expected situation in the second half. And on -- but we don't apply the policy to the first half. It's more a smaller proportion of the full leading expected is paid as interim dividend.

Okay. All right. Yes, I guess it just creates some uncertainty about what people should forecast for the interim dividend, but understood. And then just coming back to the cost guidance. Obviously, the costs have gone up quite materially, particularly at Mara Rosa versus, I guess, previous expectations, you've already talked about pricing and FX having the most -- sort of the biggest impact? How should we think about if we strip out these sort of one-off impacts prices and FX, what should we think of Mara Rosa on a sort of normalized basis once it reaches full production I guess that's the first question. And then secondly, just what are you assuming for prices and FX in your -- in the updated guidance for the rest of the year?

Thank you, Ian. So the revised all-in sustaining cost, as I said, includes the higher prices and FX local inflation. -- from the increase around 60% has to do with higher prices at a total level and 40% has to do with FX large local inflation in Argentina. As you will see, our guidance for the year in Mara Rosa is lower than what we had in H1. Our H1 number, as I said, include around $90 million of CapEx that had to do with bringing Mana Rosa back into stable production, which we have achieved by the end of -- by the end of June, -- and of course, we're seeing that better -- that good performance in July and August. We don't provide a guidance for Mara Rosa in the long term because we are actually fine-tuning our efficiency measures and the is super focused on after recovering production just making sure that we can to all the efficiencies that we can in Mara Rosa. I would say, Ian, to let's wait until the guidance for the next year for you to have a better idea on what would be more the run rate of Mara Rosa. But certainly by applying the full year guidance to your equation, you will see that the cost is improving materially in the second half, and we expect that to improve even more in the coming years. .

Okay. All right. Maybe just on that sort of ramp-up in the useful, I guess, that slide was quite ectin terms of the run rates over the months. What's assumed for the rest of the year in terms of throughput? Are you assuming this 6,300 tonnes per day or 7,000 tonnes per day within that guidance?

Yes. I would believe that we will be able to run rate at 7,000 tonnes per day at least.

That range. Yes. Okay. But what -- and the range of the sort of bottom end of the top end of the production guidance, I mean, is that just flexing the throughput rates and grades? How should we think about that?

4 No. I mean, really, the range is going to depend on the grades that we will be able to reach at the bottom of the pit. But we want to make sure that we do it in a good partner to make sure that we don't take material from 2027. It is very important to keep the planning that we have decided to have in place. So I believe that I mean what we are trying to do is to be as close as possible to the upper end of the guidance.

There are currently no further questions in the phone queue. With this, I'd like to hand the call back over to Charles for any webcast questions.

Thanks very much. The first question is -- what are the key changes that you have already seen and that you expect in the second half of the year with the new mining contractors at Mara Rosa. And my second question is, are you optimistic about potential mine life extensions at San Jose what do you need to sustain mine operations for longer?

Well, the first question is that I met personally Fagundes, that is the mining contractor, and I believe that we reach 1 of the best contractors in Brazil. They're extremely responsible and very focused on safety, which is very important for us. The run rate for Fagundes, I mean, they have reached 70,000 tonnes per day -- and I believe that they could reach like 75 -- up to 80,000 tonnes per day some days. So we have to we believe that we could recover part of the material that has not been reached during the first half. So I don't know if that answers your question, but I believe that we are in very good hands, I have to say. I mean in terms of San Jose, San Jose has a very strong mining properties. You know that all the mining property between Cerro Negro and San Jose, is a social property. We believe that with the new tools that we are using for exploration, we will be able to continue adding resources at San Jose. I mean, let's wait for the exploration results at the end of the year, but we have some promising results that they are published on the H1 report. Go ahead, Charlie.