SSR Mining (SSRM) Q1 2025 Earnings Call Transcript

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DATE

Tuesday, May 6, 2025 at 5 p.m. ET

CALL PARTICIPANTS

President and Chief Executive Officer — Rod Antal

Chief Financial Officer — Michael Sparks

Chief Operating Officer — Bill MacNevin

Vice President, Investor Relations — Alex Hunchak

SUMMARY

SSR Mining Inc. (NASDAQ:SSRM) reported production of 104,000 gold equivalent ounces at an all-in sustaining cost of $1,972 per ounce, including one month of output from the newly acquired Cripple Creek and Victor mine. Management stated that free cash flow for the period was $39 million, and the company ended the quarter with $320 million in cash after a $100 million acquisition payment. Guidance for 2025 includes a 10% production increase at a forecast all-in sustaining cost of $1,990 to $2,150 per ounce, partially reflecting care and maintenance costs at the Copler operation, which incurred $36 million in the quarter. The company plans to release an updated technical report and life-of-mine plan for Cripple Creek and Victor in the third quarter, and continues to progress permitting for a potential Copler restart, but is unable to provide a timeline for regulatory approvals.

Guidance includes a planned $60 million to $100 million in capital investment at Hod Maden for project advancement toward a construction decision.

Liquidity position exceeds $800 million, supported by ongoing free cash flow generation.

Mining at Marigold produced 39,000 ounces at an AISC of $1,765 per ounce, with production weighted to the second half of the year and sustaining capital now expected in the second quarter.

The Seabee operation generated 26,000 ounces at an AISC of $1,374 per ounce, with first-quarter grades above the mine's reserve average; normalized grades are expected for the remainder of the year.

Puna produced 2,500,000 ounces of silver at an AISC of $13.16 per ounce, with management focused on near-term mine life extension through laybacks at Chinchillas and development at Cortaderas.

First-quarter spend at Hod Maden totaled $12 million for initial site preparation and technical work, with capital outlay expected to ramp from the third quarter as construction-related contracts are awarded.

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TAKEAWAYS

Gold Equivalent Production: 104,000 gold equivalent ounces produced, including one month of production from Cripple Creek and Victor, in line with management expectations.

All-In Sustaining Cost (AISC): $1,972 per ounce, or $1,749 per ounce excluding Copler care and maintenance costs.

Free Cash Flow: Free cash flow of $39 million generated.

Operating Cash Flow: Operating cash flow of $85 million reported.

Cash Balance: $320 million at quarter-end following the $100 million CC and V acquisition payment.

Liquidity: Total liquidity position over $800 million at quarter-end, supported by continued free cash flow forecasts for the year.

2025 Production Guidance: 410,000 to 480,000 gold equivalent ounces projected; 10% higher at the midpoint compared to 2024, with AISC (non-GAAP) guidance of $1,990 to $2,150 per ounce ($1,890 to $1,950 per ounce excluding Copler care and maintenance).

Marigold Output: 39,000 ounces at $1,765 AISC, with production weighted 55%-60% toward the second half (H2) of 2025.

CC and V Output: 11,300 ounces produced in March, at $1,774 AISC in March, with total output of 39,300 ounces for the quarter (including January and February before acquisition close).

Seabee Output: 26,000 ounces at $1,374 AISC, with grades averaging 9 grams per tonne.

Puna Output: 2,500,000 ounces of silver at $13.16 AISC; focus on extending mine life with laybacks at Chinchillas and work at Cortaderas.

Hod Maden Expenditure: $12 million spent on site establishment and technical work; full-year capital forecast maintained at $60 million to $100 million, with increased spending expected from Q3 onward.

Copler Care and Maintenance Costs: Approximately $36 million incurred in care and maintenance costs at Copler during the quarter, not excluded from adjusted net income per SEC rules.

Net Income: $0.28 per diluted share reported, $0.29 per diluted share adjusted net income, both including Copler care and maintenance costs.

Cripple Creek and Victor Reserves: 2,400,000 ounces reported by Newmont at year-end 2024, an 85% year-on-year increase; full updated SSR Mining technical report targeted for Q3 release.

Buffalo Valley Deposit: Marigold's Buffalo Valley now hosts more than 500,000 ounces in its maiden reserve.

Copler Restart Permitting: Management is working with regulators on closure, remediation, and e-storage facility design approvals, but "unable to provide any more detail of when and if these permits will be received."

INDUSTRY GLOSSARY

AISC (All-In Sustaining Cost): An industry metric reflecting total costs required to produce an ounce of gold, including sustaining capital, site administration, and royalties.

Gold Equivalent Ounces: A unified production metric converting all metals output into ounces of gold based on prevailing metal prices.

Care and Maintenance Costs: Expenses incurred to maintain a mine in a non-operational state, including environmental, safety, and minimal operational activities.

Technical Report: A formal engineering document outlining resource estimates, mine plan, and economic evaluation required for regulatory and market disclosure.

Infill Drilling: Drill campaigns aimed at increasing geological confidence in a defined part of a mineral resource, often preceding development decisions.

Layback: The process of widening an open-pit mine by removing additional strips of rock to access more ore or extend mine life.

Full Conference Call Transcript

Rod Antal: Right. Thanks, Alex, and good afternoon to you all. The first quarter results marked a strong start to the year for SSR Mining Inc. All of our operations performed well against our plans, which drove the solid financial results, including nearly $40 million in free cash flow generation. The first quarter also included a month of production from Cripple Creek and Victor as we closed the transaction and formally welcomed the CC and V team into SSR Mining Inc. in February. It is pleasing to note that our efforts and planning for this transaction and transition have gone very well.

The integration has been extremely smooth so far, and while there is still more work to be done, so far we are encouraged and confident we have added a core asset to the portfolio. Following the CC and V transaction close, we issued our full-year 2025 operating guidance showing a year-over-year increase in production. The guidance also outlined our plans for meaningful investment at Hod Maden as we progress this terrific asset towards a full construction decision. We ended 2025 focused on a strong start to the year through operational delivery, which we achieved, and we will continue to build from this over the remainder of 2025.

In addition, we have a number of important priorities and catalysts on the horizon over the next twelve months. These include the delivery of a technical report and life of mine plan to Cripple Creek and Victor, the advancement of Hod Maden towards a construction decision, the continued progress on an updated and extended life of mine for Puna towards the end of the decade through the potential layback at Chinchillas and evaluation of the longer-term potential of Cortaderas, the advancement of the Buffalo Valley deposit of Marigold which now hosts more than 500,000 ounces in its maiden reserve, and of course, our top priority is continuing to advance Copler to a restart.

This is a package of work that we are actively engaging and progressing with regulators in various government departments. This includes the approval of the e-storage facility design as well as closure and remediation plans for the heap leach pad. We anticipate that once these plans are agreed, we will then seek appropriate permits to restart the operation. Good progress is being made, and while we remain confident of a restart, I am unable to provide any more detail of when and if these permits will be received. All of these efforts are focused on one key goal, delivering additional value for our shareholders. And I look forward to providing further updates on these initiatives throughout the year.

So now I'm going to turn the call over to Michael for the financial results, which are on Slide four.

Michael Sparks: Thank you, Rod, and good afternoon, everyone. The first quarter of 2025 is well aligned to our expectations. 104,000 gold equivalent ounces produced at all-in sustaining cost of $1,972 per ounce or $1,749 per ounce excluding costs incurred at Copler during the quarter. These results drove operating cash flow of $85 million and free cash flow of $39 million during the quarter. Following the $100 million cash payment made upon the close of the CC and V acquisition, we ended the quarter with $320 million in cash on hand. We also spent approximately $12 million advancing Hod Maden in the first quarter as we progress engineering and initial site development activities.

Brownfield exploration and development work continued at Marigold, Seabee, and Puna, and Bill will provide more details on these initiatives in a few minutes. Now moving on to our financial results on Slide five. We recorded attributable net income of $0.28 per diluted share in the first quarter and adjusted net income of $0.29 per diluted share. Both figures include approximately $36 million in care and maintenance costs at Copler during the quarter as these costs are not adjusted for under SEC rules. As previously noted, first quarter free cash flow of $39 million was a strong result to start 2025. This strong free cash flow generation maintains our total liquidity position of over $800 million.

With continued free cash flow generation forecasted through 2025, we remain in a very strong position financially and are well positioned to manage all capital requirements across the business. We have plenty of work in front of us, but we are proud of the strong start to the year and look forward to building on this momentum in the coming months. If you turn to Slide seven, I'll hand over to Bill.

Bill MacNevin: Thanks, Michael. It was a great start to the year. And I want to walk through some of the successes at each of our operations. First, though, I'll start with a brief refresh on our 2025 guidance as shown on this slide. We expect to produce between 410,000 and 480,000 gold equivalent ounces this year and an AISC of $1,990 to $2,150 per ounce. Or $1,890 to $1,950 per ounce when excluding care and maintenance costs at Copler. This production forecast is a 10% increase over 2024 on a midpoint basis and includes ten months of production from CC and V.

Our guidance also includes an initial capital spend forecast of $60 million to $100 million for Hod Maden as we advance the project toward a construction decision. Now let's move on to Slide eight for operational updates. Starting with Marigold. Marigold produced 39,000 ounces in the first quarter at an AISC of $1,765 per ounce. A solid start to the year with grades to trend upwards towards the end of the second quarter delivering strongest production in Q3 and driving a 55% to 60% H2 weighted production profile. Sustaining capital trended below expectations in Q1, with this spend now expected in the second quarter.

We are continuing to focus our exploration and growth efforts on oxide mineral reserve additions at Buffalo Valley and New Millennium. We look forward to providing further updates on these initiatives as they progress. Now on to CC and V on Slide nine. I want to start by acknowledging the hard work from our teams that helped enable a very successful start to the integration process for CC and V. It's a pleasure to bring a team of this caliber into our portfolio and we are continuing to integrate the asset into our portfolio as we plan for the future. Attributable first production from CC and V covers the month of March, following the transaction's close.

Production in March is 11,300 ounces, at an AISC of $1,774. Aligned with our expectations. Inclusive of the January and February production, CC and V produced 39,300 ounces of gold in Q1. As a reminder, Newmont reported CC and V mineral reserves of 2,400,000 ounces as of the end of 2024 in the year-end results. This is an 85% year-on-year increase. This expanded reserve demonstrates potential upside of what we believe will be a long-lived and significant contributor to our portfolio for many years to come. To that end, we're advancing technical work to inform an updated life of mine plan and accompanying technical report for CC and V.

With a large existing reserve setting, the stage for a long mine life at CC and V. These initiatives will help further define and showcase some of the upside we identified during the due diligence process. Now on to Seabee. Seabee had an excellent start to the year, producing 26,000 ounces at an AISC of $1,374 per ounce. As a result of continued positive grade reconciliation in the Santoy 9 ore body. While grades averaged nine grams per tonne in Q1, we expect this to be normalized towards reserve grades for the remainder of the year. And have left full-year guidance assumptions unchanged as a result. The recent grade outperformance has certainly been welcome.

But should not diminish the hard work our teams have put in to drive continuous improvement at the asset as we seek to deliver improved underground productivity and maintenance practices going forward. With respect to growth and exploration, we're continuing to advance drilling campaigns at both Santoy and Porky targets as we evaluate potential opportunities to extend the mine life at Seabee. This work has been productive so far, and we look forward to providing further updates with our year-end reserves and resources. Now on to Puna, Slide 11. Puna produced 2,500,000 ounces of silver in the first quarter and an AISC of $13.16 per ounce. An excellent result to start the year.

Our current focus at Puna is on mine life extension opportunities. Particularly on laybacks at Chinchillas, to support near life mine extension deeper into the decade as we advance engineering work on the Cortaderas target. Puna has been an exceptional contributor to our portfolio and we're keen to see its continued production and growth for many years to come. On Slide 12, Turkey, At Hod Maden, we spent approximately $12 million on initial site establishment assets and technical work in the quarter. While infill drilling also continues at site, with the aim of derisking the first four years of the mine. Simultaneously, we continue to progress efforts on financing options for Hod Maden as we approach a construction decision.

As Rod mentioned, we have continued to advance discussions with regulators and various government departments around the potential restart of operations at Copler. In the meantime, care and maintenance costs have remained aligned with guidance, and we spent approximately $5 million in the first quarter on remediation and reclamation activities. Overall, a lot of positive efforts and progress in Turkey to start the year. Now I will turn back to Rod for closing remarks.

Rod Antal: Right. Thanks, Bill. Thanks, Michael. We ended 2025 with a focus on operational delivery as we continue to rebuild a track record of being a reliable producer and adding shareholder value through various initiatives. As you have heard, we are pleased with our results out of the gate in quarter one and will build on this momentum over the course of the year. We're thrilled that we have closed the unit and integrated CC and V into SSR Mining Inc. with steady production and cash flows expected to contribute meaningfully to our business for many years to come.

Overall, our business is in excellent shape and we are focused on delivering on a number of operational improvements and growth initiatives during the year. We believe the company has significant upside and look forward to progressing the various drivers to realize this potential during 2025. So with that, I'm going to turn the call over to the operator for any questions you may have. Thank you.

Operator: Thank you, Mr. Antal. We will now begin the question and answer session. The first question comes from Cosmos Chiu with CIBC. Please go ahead.

Cosmos Chiu: Hi, thanks Rod and team. Maybe my first question is on the Cripple Creek and Victor here. Congrats on closing the deal. I know you kind of touched on it, but I'm just wondering, you know, what's the next steps in terms of what you can show us, what you can do at Cripple Creek and Victor? I know you're gonna spend the next twelve months in terms of a new life of mine plan, but as you mentioned, it's increased more than 80% in terms of reserves to 2,400,000 ounces.

I'm just wondering how you know, between now and the next twelve months, how we can use some of this information that's been given to us in terms of how we can optimize the model that we built into your evaluation.

Rod Antal: Yeah. Good question, Cosmos. I'm gonna pass over to Bill for some comments, and then if there's anything else, I'll wrap it up.

Cosmos Chiu: Yeah. Afternoon, Bill.

Bill MacNevin: One of the key things that is part of our first piece of work, we obviously are collecting a lot more information and key to that, we're compiling and we're gonna build out that new life of mine report and most importantly, a technical report. That technical report will have our best understanding of where we currently stand. At the same time, we'll be continuing a lot more work looking at what we can do with the business in the future. But in terms of handing something across, that technical report later this year will be our best and most immediate update.

Cosmos Chiu: And what's the timing of that technical report? If there's a timing at this point in time?

Bill MacNevin: Yeah. We're working to get that out in Q3. So that's when we'll be pulling that together. Everyone's feverishly working away at the moment. And, obviously, engaging with the site team and gathering more information face to face that's helping amend. So we look forward to getting that out to everyone. Yeah. I think, because the truth is

Rod Antal: that we're well aware that when we acquired the asset and have acquired the asset now, of course, there's a bit of a dot of information in the market around CC and V given Newmont hadn't published a technical report on the asset for many, many years. That's really been the priority for us to reacquaint the market with the asset, but on the back of publishing a new tech report. So it feels like a long time, but it's not. And I think it's important we take the steps Bill's outlined to really demonstrate what we see as a deep value for the asset moving forward.

And as you rightly point out, I think the new reserve basis that Newmont published just before their transaction closed, should drive a level of excitement for, you know, for its potential and then you know, I think beyond that, you know, that's our job is to keep on describing what other value we think we might be able to eke out of the asset moving forward. So early days, things have gone really well as we mentioned, and nothing that we've seen so far has really disappointed us.

Cosmos Chiu: Mhmm. Yeah. I'm just I guess the genesis of my question is that I've seen other companies, some of your competitors that have also acquired assets from Newmont. Broadly speaking, they talk about, you know, different areas where they can optimize. I'm just wondering if broadly speaking, I know the actual numbers won't come on till later on in hopefully, Q3, as you mentioned. But broadly speaking, are there areas that we can we can focus on, that we should focus on, that you can share with us, or maybe not at this point in time?

Rod Antal: Mainly because I think what you've described is out in other cases, where assets are a little bit better understood. So we're obviously in that regard, it's a little bit further behind because of the other publications around Cripple Creek in the market. So we're gonna catch that up. So I think, you know, for us to be able to take it over, work through all the technical details for our, you know, our team and our CPs to be able to sign off on that. In the time frame that Bill's talking about is pretty fast. So that's really a priority for us.

Cosmos Chiu: Yep. I perfectly understand. Maybe switching gears to Turkey at Hod Maden. As you mentioned, you spent $12.2 million in CapEx, development CapEx in Q1. Your target is $60 to $100 million. Could you maybe talk about the velocity of the increase that we're expecting? I guess, number one, $60 million to $100 million, that's a fairly large range. That's number one. And if I look at it if I were to annualize $12.2 million, I get to the lower end, but I don't think I should do that. So maybe if you can talk about how we should look at the potential velocity of increase.

Rod Antal: Yeah. Look. I think the progress that we're making at site at the moment is we're actually tendering out some of the early works around the infrastructure. So that is progressing well. And once those contracts are let, so these are, you know, civil works and tunnel access, etcetera, into site. The spend will escalate accordingly. Beyond the sort of $12 million in the quarter, which has been primarily, you know, owners costs and engineering fees. So that'll start to ramp up particularly from Q3 onwards, Cosmos. As we start to let that contract.

You know, if we let them now there's still that sort of lag by the time folks get mobilized and contracted get mobilized, but that'll start to really uplift itself in quarter three, quarter four. I think we did leave that range in there mainly around the timing of that ramp up, but as we move through the year and we get a bit more fidelity around it, if we need to tighten that up, we will be coming into quarter three. So things are progressing quite well there, actually.

Cosmos Chiu: Mhmm. And then maybe a follow-up. As you mentioned, with the work that you're doing, you're trying to get more confidence at least around the first four years of production. And as you talked about, the technical report for Cripple Creek and Victor, Hod Maden, there is a technical report as well. Dated 2022, I believe. So I guess my question is, number one, you know, the first four years, are you trying to gain more confidence around what was disclosed in that most recent feasibility study? And number two, should we still use that feasibility as a basis in terms of the economics around Hod Maden?

Rod Antal: The work we're doing, I think we sort of described it after we acquired the asset was more around ensuring that we had the fidelity in the infill drilling particularly in those early years because they're important from an economic return perspective, but also from us being able to describe to the market, you know, what the early years of production will be. That's what we spend a lot of time on. Shoring up the flow sheets around, you know, around that work that, you know, with the drilling that we've got. The engineering and all of the other pieces that go with it.

So that's continued, and at the moment, yes, I would suggest using 2022 as still your basis. It's the best basis out there. Yeah. I mean, as we obviously, get closer to making a project decision. We'll get closer to then republishing the tech report with all the outcomes of that work and also progressing the financial options around the project. The other thing, though, that we did note on the acquisition calls was the inflation that we've been experiencing in Turkey. With the project. As you rightly point out, the last project estimate was 2022. You know, we're now three years beyond and four years, you know, by the time we get to this year.

And what we suggested and guided folks to do was to compound it sort of 10 to 15% inflation rate to the capital number to sort of bring it up to today's dollars. And we haven't seen any relief from that inflation pressures either. So I think that's still valid.

Cosmos Chiu: Mhmm. Great. Yeah. I think we've inflated our numbers as well. It suggested maybe one last question. As you mentioned, you know, Hod Maden and Turkey, Copler is also in Turkey. Maybe I'm just I don't know if you can answer this, Rod. But is there any kind of connection in terms of those two in terms of a potential restart at Copler and how there is any kind of connection to what might be a construction decision at Hod Maden, or are they completely separate?

Rod Antal: No. We purposely kept them separate because that's the way we would've run the project anyway, to be honest with you. Yeah. This is a greenfields project, as you know. It's not a brownfields project, so it was not a natural extension of Copler. As we did with the sulfide project, for instance. So it was actually set up that way and purposely set up that way at any rate. It has its own project team. It has its own infrastructure. There are some linkage points into the Ankara team in terms of, you know, HR, finance, community relations, and other things. But beyond that, the project is sort of considered a greenfields project of sorts.

So we had structured it that way anyway. And as it turns out, when we think about Copler and Hod Maden, we consider them separately. So there's no link to them from a government perspective. There's no link to them in terms of the success of us getting the permits to restart Copler. They're sort of both marching on their own drumbeat. With different priorities and different sense of urgency. So that's how we're running it. Of course, as time goes on, and you know, Hod Maden goes into construction, and goes through its normal construction phases. There'll be more of an integration into the current infrastructure we have around the Ankara team.

For taking it over because ultimately, you know, we'll leverage off that overhead we've already got set up in-country. But at this stage, there's a separate project team set up.

Cosmos Chiu: Great. Thanks again, Rod. Bill, Michael, and Alex. Those are all the questions I have. Thank you.

Alex Hunchak: Right. Thanks, Cosmos.

Operator: This concludes the question and answer session and today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

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