Amerigo Reports Q3-2024 Operational Results Q 3-2024 Copper Production of 16.3 million pounds, Outperforming Guidance Q3-2024 cash cost1 of $1.93 per pound, Outperforming Guidance C urrent Copper Prices Rising in Response to Global Stimulus
O
ctober 8, 2024
N.R. 2024-13
Amerigo Reports Q3-2024 Operational Results
Q
3-2024 Copper Production of 16.3 million pounds, Outperforming Guidance
Q3-2024 cash cost1 of $1.93 per pound, Outperforming Guidance
C
urrent Copper Prices Rising in Response to Global Stimulus
$8.
5 million in Quarterly and Performance Dividends Paid in Q3-2024
VANCOUVER, BRITISH COLUMBIA – October 8, 2024/Amerigo Resources Ltd. (TSX: ARG; OTCQX:
ARREF) (“Amerigo” or the “Company”) is pleased to announce production results for the quarter ended
September 30, 2024 (“Q3-2024”) from Minera Valle Central (“MVC”), the Company’s 100% owned operation
located near Rancagua, Chile. Dollar amounts in this news release are in U.S. dollars unless indicated otherwise.
“MVC delivered a strong quarter with copper production of 16. 3 million pounds, outperforming guidance. The
Company’s quarterly cash cost of $1.93 per pound was again lower than expected, and Amerigo’s quarterly
copper price in the third quarter was $4.22 per pound. This combination of excellent operational performance,
controlled costs and high copper prices translates into robust financial performance, permitting the Company to
continue implementing its Capital Return Strategy,” said Aurora Davidson, Amerigo’s President and CEO.
“Amerigo’s Capital Return Strategy was designed so shareholders can quickly benefit from a quarter like this.
We will continue to deploy all three mechanisms in the Strategy with maximum flexibility, as we expect copper
prices to continue strengthening due to fundamental supply and demand issues. We are off to a great start in
Q4, as copper prices are well above the quarterly average prices we have received throughout 2024,” she added.
In Q3-2024, MVC produced 16.3 million pounds (“M lbs”) of copper, with 70% of production coming from fresh
tailings and 0.3 M lbs of molybdenum. MVC’s plant availability was 97%.
During the nine months ended September 30, 2024 (“YTD-2024”), MVC produced 46.2 M lbs of copper and 1.0
M lbs of molybdenum. YTD-2024 production results are trending ahead of Amerigo’s annual production guidance
of 62.4 M lbs of copper and 1.2 M lbs of molybdenum.
Amerigo’s cash cost1 in Q3-2024 was $1.93 per pound (“/lb”), and YTD-2024 normalized cash cost1 was $1.93/lb,
both below the Company’s 2024 cash cost 1 guidance of $2.08/lb. YTD -2024 normalized cash cost1 excludes
$0.02/lb paid to MVC’s supervisors in January 2024 as the signing bonus of a 3-year collective labour agreement.
On September 30, 2024, MVC’s water reserves were over 10.0 million cubic meters, sufficient to maintain
projected historic tailings processing rates for at least eighteen months, the Company’s maximum forecast
horizon.
Amerigo’s quarterly copper price in Q3-2024 was $4.22/lb, compared to $4.39/lb in Q2-2024. The Company’s
molybdenum price was $21.39/lb, compared to $21.11/lb in Q2-2024.
1 This is a non-IFRS measure. See “Non-IFRS Measures” for further information.
1 This is a non-IFRS measure. See “Non-IFRS Measures” for further information.
In Q3-2024, Amerigo paid shareholders $8.5 million in dividends, bringing YTD-2024 dividend payments to $15.8
million.
On September 30, 2024, Amerigo’s cash position was $25.1 million ($8.9 million higher than December 31,
2023), and restricted cash was $ 6.7 million ($0.4 million higher than December 31, 2023 ). Outstanding bank
debt was $15.5 million, $5.8 million lower than December 31, 2023.
Q3-2024 Q2-2024 Q1-2024 Q4-2023 Q3-2023
Fresh tailings
Tonnes per day 129,339 111,636 116,246 117,331 109,276
Operating days 92 82 90 92 86
Million tonnes processed 12 9.25 10.51 10.79 9.40
Copper grade 0.184% 0.184% 0.177% 0.174% 0.175%
Copper recovery 23.6% 23.6% 20.8% 21.0% 22.6%
Copper produced (M lbs) 11.38 8.98 8.55 8.69 8.21
Historic tailings
Tonnes per day 32,815 45,469 49,289 50,578 45,588
Operating days 88 62 90 91 38
Million tonnes processed 3 2.91 4.42 4.58 1.73
Copper grade 0.239% 0.245% 0.251% 0.243% 0.239%
Copper recovery 32.1% 31.3% 30.5% 31.3% 32.0%
Copper produced (M lbs) 4.89 5.00 7.45 7.68 2.91
Copper produced (M lbs) 16.27 13.98 16.00 16.37 11.12
Copper delivered (M lbs) 16.48 14.33 15.96 16.08 10.98
Cash cost1 ($/lb) 1.93 1.96 1.96 2.06 2.44
Normalized cash cost1 ($/lb) 1.93 1.96 1.89 2.06 2.44
Molybdenum produced (M lbs) 0.33 0.30 0.32 0.33 0.22
Molybdenum sold (M lbs) 0.33 0.30 0.32 0.33 0.22
Capital Return Strategy
Since implementing its Capital Return Strategy (the “Strategy”) in September 2021, Amerigo has returned a total
of $72.7 million to shareholders, $49.0 million through quarterly and performance dividends and $23.7 million
through share buybacks, reducing by 11.1% the number of common shares outstanding at the inception of the
Strategy.
Amerigo’s Strategy consists of three mechanisms: quarterly dividends, performance dividends, and share
buybacks. These mechanisms ideally provide shareholders with a consistent return on invested capital and
quickly transfer the benefits of rising copper prices to Amerigo’s shareholders.
Release of Q3-2024 financial results on October 30, 2024
Amerigo will release Q3-2024 financial results at the market open on Wednesday, October 30, 2024.
Investor conference call on Thursday, October 31, 2024
Amerigo’s quarterly investor conference call will be held on Thursday, October 31, 2024, at 11:00 a.m. Pacific
Daylight Time/2:00 p.m. Eastern Daylight Time.
Participants can join by visiting https://emportal.ink/4dccA8Y and entering their name and phone number. The
conference system will then call the participants and place them instantly into the call.
Alternatively, participants can dial directly to be entered into the call by an Operator. Dial 1-888-510-2154 (Toll-
Free North America) and state they wish to participate in the Amerigo Resources Q3-2024 Earnings Call.
About Amerigo and MVC
Amerigo is an innovative copper producer with a long-term relationship with Corporación Nacional del Cobre de
Chile (“Codelco”), the world’s largest copper producer.
Amerigo produces copper concentrate and molybdenum concentrate as a by -product at the MVC operation in
Chile by processing fresh and historic tailings from Codelco’s El Teniente mine, the world's largest underground
copper mine. Tel: (604) 681-2802; Web: www.amerigoresources.com; Listing: ARG: TSX.
Contact Information
Aurora Davidson Graham Farrell
President and CEO Investor Relations
(604) 697-6207 (416) 842-9003
[email protected] [email protected]
Non-IFRS Measures
This news release references cash cost, and YTD-2024 normalized cash cost, performance measures not defined under I nternational
Financial Reporting Standards (“IFRS”).
Cash cost is a non-IFRS performance measure included in this news release as it is a key performance measure used by management
to monitor operating performance, assess corporate performance, and plan and assess the overall effectiveness and efficiency of
Amerigo’s operations. Non -IFRS performance measures are not standardized under IFRS; therefore, amounts presented may not be
comparable to similar financial measures disclosed by other companies. Non -IFRS performance measures should not be considered a
substitute for performance measures under IFRS.
Cash cost is a performance measure commonly used in the mining industry. In Amerigo’s case, cash cost is the aggregate of smelting
and refining charges, tolling/production costs net of inventory adjustments, and administration costs net of by-product credits. Cash cost
per pound produced is based on pounds of copper produced and is calculated by dividing cash cost by the number of pounds of copper
produced.
YTD-2024 normalized cash cost excludes $0.02/lb paid to MVC’s supervisors in January 2024 as the signing bonus of a 3-year collective
labour agreement.
The Company reconciles non-IFRS performance measures against IFRS measures every quarter when financial results are reported.
Reconciliations are included in the Company’s quarterly earnings release and its Management’s Discussion and Analysis.
Cautionary Note Regarding Forward-Looking Information
This news release contains certain forward-looking information and statements defined in applicable securities laws (collectively called
"forward-looking statements"). These statements relate to future events or the Company’s future performance. All statements other than
statements of historical fact are forward-looking statements. The use of any of the words "anticipate", "plan", "continu e", "estimate",
"expect", "may", "will", "project", "predict", "potential", "should", "believe" and similar expressions are intended to identify forward-looking
statements. These forward-looking statements include, but are not limited to, statements concerning:
• forecasted production and operating costs for 2024;
• the maintenance of the Company’s Capital Return Strategy;
• our strategies and objectives;
• our estimates of the availability and quantity of tailings and the quality of our mine plan estimates;
• the sufficiency of MVC’s water reserves to maintain projected historic tailings tonnage processing for at least 18 months;
• prices and price volatility for copper, molybdenum and other commodities and materials we use in our operations;
• the demand for and supply of copper, molybdenum and other commodities and materials that we produce, sell and use;
• sensitivity of our financial results and share price to changes in commodity prices;
• our financial resources and financial condition and our expected ability to redeploy other tools of our capital return strategy;
• interest and other expenses;
• domestic and foreign laws affecting our operations;
• our tax position and the tax rates applicable to us;
• our ability to comply with our loan covenants;
• the production capacity of our operations, our planned production levels and future production;
• potential impact of production and transportation disruptions;
• hazards inherent in the mining industry causing personal injury or loss of life, severe damage to or destruction of property and
equipment, pollution or environmental damage, claims by third parties and suspension of operations;
• estimates of asset retirement obligations and other costs related to environmental protection;
• our future capital and production costs, including the costs and potential impact of complying with existing and proposed environmental
laws and regulations in the operation and closure of our operations;
• repudiation, nullification, modification or renegotiation of contracts;
• our financial and operating objectives;
• our environmental, health and safety initiatives;
• the outcome of legal proceedings and other disputes in which we may be involved;
• the outcome of negotiations concerning metal sales, treatment charges and royalties;
• disruptions to the Company's information technology systems, including those related to cybersecurity;
• our dividend policy; and
• general business and economic conditions, including, but not limited to, our assessment of strong market fundamentals support ing
copper prices.
These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such statements. Inherent in forward- looking statements are risks and uncertainties
beyond our ability to predict or control, including risks that may affect our operating or capital plans; risks generally enc ountered in the
permitting and development of mineral projects such as unusual or unexpected geological formations, negotiations with government and
other third parties, unanticipated metallurgical difficulties, delays associated with permits, approvals and permit appeals, ground control
problems, adverse weather conditions (including, but not limited to, continued extreme rainfall) , process upsets and equipment
malfunctions; risks associated with labour disturbances and availability of skilled labour and management; risks related to the potential
impact of global or national health concerns, and the inability of employees to access sufficient healthcare; government or r egulatory
actions or inactions; fluctuations in the market prices of our principal commodities, which are cyclical and subject to substantial price
fluctuations; risks created through competition for mining projects and properties; risks associated with lack of access to markets; risks
associated with availability of and our ability to obtain both tailings from Codelco’s Division El Teniente’s (“DET”) current production and
historic tailings from tailings deposit; the availability of and ability of the Company to obtain adequate funding on reasonable terms for
expansions and acquisitions; mine plan estimates; risks posed by fluctuations in exchange rates and interest rates, as well as general
economic conditions; risks associated with environmental compliance and changes in environmental legislation and regulation; risks
associated with our dependence on third parties for the provision of critical services; risks associated with non-performance by contractual
counterparties; risks associated with supply chain disruptions; title risks; social and political risks associated with operations in foreign
countries; risks of changes in laws affecting our operations or their interpretation, including foreign exchange controls; and risks associated
with tax reassessments and legal proceedings. Many of these risks and uncertainties apply to the Company and its operations , as well
as DET and its operations. DET’s ongoing mining operations provide a significant portion of the materials the Company processes and
its resulting metals production. Therefore, these risks and uncertainties may also affect the Company's operations and have a material
effect.
Actual results and developments will likely differ materially from those expressed or implied by the forward-looking statements in this news
release. Such statements are based on several assumptions which may prove to be incorrect, including, but not limited to, assumptions
about:
• general business and economic conditions;
• interest and currency exchange rates;
• changes in commodity and power prices;
• acts of foreign governments and the outcome of legal proceedings;
• the supply and demand for, deliveries of, and the level and volatility of prices of copper, molybdenum and other commodities and
products used in our operations;
• the ongoing supply of material for processing from DET’s current mining operations;
• the grade and projected recoveries of tailings processed by MVC;
• the ability of the Company to profitably extract and process historic tailings;
• the timing of the receipt of and retention of permits and other regulatory and governmental approvals;
• our costs of production and our production and productivity levels, as well as those of our competitors;
• changes in credit market conditions and conditions in financial markets generally;
• our ability to procure equipment and operating supplies in sufficient quantities and on a timely basis;
• the availability of qualified employees and contractors for our operations;
• our ability to attract and retain skilled staff;
• the satisfactory negotiation of collective agreements with unionized employees;
• the impact of changes in foreign exchange rates and capital repatriation on our costs and results;
• engineering and construction timetables and capital costs for our expansion projects;
• costs of closure of various operations;
• market competition;
• tax benefits and tax rates;
• the outcome of our copper concentrate sales and treatment and refining charge negotiations;
• the resolution of environmental and other proceedings or disputes;
• the future supply of reasonably priced power;
• average recoveries for fresh tailings and historic tailings;
• our ability to obtain, comply with and renew permits and licenses in a timely manner; and
• Our ongoing relations with our employees and entities we do business with.
Future production levels and cost estimates assume no adverse mining or other events significantly affecting budgeted production levels.
Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject
to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond the Company’s cont rol, the
Company cannot assure that it will achieve or accomplish the expectations, beliefs or projections described in the forward-looking
statements.
The preceding list of important factors and assumptions is not exhaustive. Other events or circumstances could cause our results to differ
materially from those estimated, projected, and expressed in or implied by our forward-looking statements. You should also consider the
matters discussed under Risk Factors in the Company`s Annual Information Form. The forward-looking statements contained herein
speak only as of the date of this news release. Except as required by law, we undertake no obligation to publicly or otherwise revise any
forward-looking statements or the preceding list of factors, whether due to new information or future events.