Compañía de Minas Buenaventura S.A.A. (BVN) This fall 2023 Earnings Name Transcript

Compañía de Minas Buenaventura S.A.A. (NYSE:BVN) This fall 2023 Earnings Convention Name March 1, 2024 10:00 AM ET

Firm Contributors

Gabriel Salas – IR

Leandro Garcia – CEO

Juan Carlos Ortiz – VP, Operations

Daniel Dominguez – CFO

Roque Benavides – Chairman

Aldo Massa – VP, Enterprise Growth & Industrial

Renzo Macher – VP, Tasks

Convention Name Contributors

Cesar Perez-Novoa – BTG Pactual

Carlos De Alba – Morgan Stanley

Tanya Jakusconek – Scotiabank

Omar Avellaneda – Prima AFP

Operator

Good day, girls and gents. Welcome to the Compañía de Minas Buenaventura Fourth Quarter 2023 Earnings Outcomes Convention Name. At the moment, all individuals are in a listen-only mode and please notice that this name is being recorded.

I might now prefer to introduce your host for right this moment’s name, Mr. Gabriel Salas, Investor Relations. Mr. Salas, you could start.

Gabriel Salas

Good morning, everybody, and thanks for becoming a member of us right this moment to debate our fourth quarter 2023 outcomes. Immediately’s dialogue can be led by Mr. Leandro Garcia, Chief Government Officer. Additionally becoming a member of our name right this moment and out there on your questions are: Mr. Daniel Dominguez, Chief Monetary Officer; Mr. Juan Carlos Ortiz, Vice President of Operations; Mr. Aldo Massa, Vice President of Enterprise Growth and Industrial; Mr. Alejandro Hermoza, Vice President of Sustainability; Mr. Renzo Macher, Vice President of Tasks; Mr. Juan Carlos Salazar, Vice President of Exploration; Mr. Roque Benavides, Chairman; and Mr. Raul Benavides, Director.

Earlier than I hand our name over, let me first contact on just a few objects. On Buenaventura’s web site, you will discover our press launch that was posted yesterday after the market closed. Please notice that right this moment’s remarks embrace forward-looking statements which can be based mostly on administration’s present views and assumptions. Whereas administration believes that its assumptions, expectations and projections are cheap in view of the at the moment out there data, you might be cautioned to not place undue reliance on these forward-looking statements. I encourage you to learn the complete disclosure regarding forward-looking statements throughout the earnings outcomes press launch issued on February 29, 2024.

Let me now flip the decision to Mr. Leandro Garcia.

Leandro Garcia

Thanks, Gabriel. Good morning, and thank you for becoming a member of us right this moment to debate the quarterly outcomes of the corporate. On Slide 2 is our cautionary assertion, essential data that I encourage you to learn this. We assume that you’ve got already learn the complete yr 2023 outcomes reported yesterday. Transferring on the subsequent slide. Our presentation will cowl the 5 fundamental matters proven on this agenda and can be adopted by our Q&A session, the place our group and myself can be blissful to reply your questions.

Let’s start with some overview of the important thing highlights of the 2023. Our EBITDA from direct operations for 2023 has elevated 38% in comparison with the earlier yr. It’s price mentioning that the figures don’t embrace the $300 million obtained final yr from the sale of our stake in Yanacocha. Our money place stays robust within the fourth quarter of final yr attributable to a robust efficiency at El Brocal, leading to a leverage fee of two.05 instances, the bottom in two years and inside our goal vary. Full yr 2023 web revenue was 33 million, negatively impacted by $113 million non-cash provision associated to former SUNAT dispute.

Capital expenditures in 2023 totaled $239 million, together with $94 million allotted to the San Gabriel Challenge. Moreover, Buenaventura made an additional funding of $33 million in superior funds for the San Gabriel Challenge. When taking into consideration each points, the full disbursement for San Gabriel Challenge amounted to $127 million. We’re happy to share that our dividends acquired from Cerro Verde in the course of the quarter have contributed as much as $49 million, strengthening our total monetary efficiency. The corporate acquired a complete of $147 million in dividends for the complete yr 2023.

Manufacturing from Yumpag’s pilot stope started in November 2023, producing 2.3 million ounces of silver by year-end. Yumpag continued processing ore from the pilot stope via January 2024, after which mineral processing was suspended till definitive working permits are obtained, anticipated by the top of the primary quarter of this yr.

Yumpag is due to this fact anticipated to reinitiate mineral processing within the second quarter of this yr. Report 2023 copper manufacturing resulted from profitable migration to huge underground methodology, enabling El Brocal to in the end obtain a mean of 10,800 tons per day in the course of the fourth quarter 2023, surpassing its focused 10,000 tons per day underground mine exploration fee.

Our consolidated manufacturing of copper, silver and gold throughput 2023 has yielded within the following outcomes: 58,000 tons of high quality copper attributed to the distinctive manufacturing at El Brocal, assembly the higher vary of the steering; 9.2 million ounces of silver reaching the complete yr steering, in the course of the fourth quarter of 2023, Uchucchacua and Yumpag contributed with 2.6 million ounces; 155,000 ounces of gold with constant manufacturing of Orcopampa. This manufacturing enabled us to surpass the higher vary of the steering.

Transferring to our price construction in Slide 5. Aligned with our technique to extend our company publicity, we’re displaying the all-in sustaining price figures as copper and gold equal. Right here, you’ll be able to see that our 2023 all-in sustaining prices have diminished by 8% and 27%, respectively, year-over-year. This discount is primarily attributed to the copper manufacturing at El Brocal and silver manufacturing at Yumpag. Nonetheless, you will need to point out that each figures are as consolidated foundation and embrace 100% of Buenaventura’s La Zanja and El Brocal.

Transferring on the associated fee relevant to gross sales energy. As you’ll be able to see, prioritization of copper ore at El Brocal and the ramp-up within the underground mine is translating into a ten% price discount year-over-year. Silver CAS has decreased 3% year-over-year, primarily pushed by decrease price in the course of the fourth quarter of 2023 with the contribution of Uchucchacua and Yumpag silver ores. Gold CAS has remained comparatively flat year-over-year regardless of the reserves depletion at La Zanja and decrease manufacturing in Tambomayo.

On the subsequent slide, we can be presenting the free money circulate technology. Throughout 2023, we diminished our money place by $34 million, primarily because of the intensive capital expenditure marketing campaign, which incorporates San Gabriel. The EBITDA to free money circulate reconciliation is defined by the next breakdown of inflows and outflows. El Brocal, Orcopampa and Tambomayo have been the principle contributors for the 2023 whereas La Zanja, Julcani and Uchucchacua had a damaging EBITDA because of the decrease manufacturing for the primary two belongings and care and upkeep at Uchucchacua for the primary 9 months.

Nonetheless, we recorded a optimistic EBITDA for the fourth quarter of 2023, due to the resumption of Uchucchacua and the contribution of Yumpag. As we now have talked about earlier than, Buenaventura goes via a progress part with an intensive CapEx associated to Yumpag and San Gabriel. This has been partly offset by the dividends acquired from Cerro Verde.

Within the following slides, I wish to illustrate our fundamental 4 flagships: first, Yumpag producing at full potential as soon as the particular working permits have been obtained anticipated by the top of the primary quarter of 2024; second, El Brocal underground mine growth at 12 tons per day within the following two years; third, San Gabriel ramp-up and the primary gold bar throughout yr 2025; and fourth, Cerro Verde dividend distribution for roughly between $120 million and $150 million within the following yr.

As you’ll be able to see, our assortment of mines supply over 10 years of uninterrupted reserve and useful resource extraction. We’ve up to date our useful resource and reserve values proven. In copper, we now have 1.9 million tons of reserves, together with an extra 3.1 million tons of sources. In silver, we now have and 128 million ounces of reserves with Yumpag making a big contribution. Moreover, we now have 199 million of useful resource. Lastly, in gold, we now have 2.8 million ounces of reserves with San Gabriel being our main future gold manufacturing supply. Moreover, we now have 3.5 million ounces of sources.

Transferring ahead to our 2024 steering. As evident, the prioritization of copper ore at El Brocal and the ramp-up within the underground mine will allow us to take care of an annual copper manufacturing in 2024 between 55,000 tons and 60,000 tons per yr. Silver manufacturing will see a 65% year-over-year enhance primarily because of the contributions of Uchucchacua and Yumpag silver ounce. Gold manufacturing will lower by 12% year-over-year, primarily because of the diminished contribution of Tambomayo gold ounces.

Lastly, additionally it is related that in 2024, we estimate executing between $300 million and $320 million of CapEx with roughly $220 million allotted to growth of San Gabriel. The full CapEx estimate for the undertaking are being reviewed attributable to some delays and escalation prices. We’re constantly in search of optimization and efficiencies within the undertaking to regulate the CapEx as a lot as attainable.

Transferring on to Slide 10. Within the subsequent yr, Buenaventura can be focusing most of its efforts in San Gabriel Challenge as a result of will probably be a related contributor to the corporate’s worth. It’ll add greater than 14 years of lifetime of mine to the corporate and one other 14 years if we think about the reserves. On this slide, you’ll be able to see the undertaking’s progress quarter-by-quarter. Within the upcoming quarters, we’ll full the set up of the concrete plant and the development of the campsite. On the subsequent slide, we’re displaying the earth motion actions for the processing plant facility.

On Slide 11, you’ll be able to see the progress of the development till the top of the third quarter of 2023, whereas in Slide 12, we are able to see an replace on the development in the direction of the top of the fourth quarter of 2023. By 2023 year-end, we now have crammed over 80,000 cubic meters of fabric and reduce over 250,000 cubic meters.

On the subsequent slide, we present a few different elements of this undertaking, together with the replace as of the top of the fourth quarter of 2023. On the high, you’ll be able to see the San Gabriel particular campsite with a 98% of progress and over 1,000 beds already put in. The {photograph} on the backside present the progress of the principle storage space, the place we have already got 40% of the tools on web site. 30% of the tools have already arrived to Peru however are pending to be transported to the location.

Lastly, I wish to end the presentation with a few closing remarks. First, San Gabriel will permit us to stabilize our gold manufacturing at 130,000 to 150,000 ounces yearly within the midterm. We’re on observe as we purpose for our first gold bar by the second half of 2025.

The continuing success of Yumpag confirms its standing as a world-class asset, marked by continuously excessive silver grades. As we now have talked about, the particular working permits are anticipated by March 2024. El Brocal is strategically specializing in the copper underground mine, maximizing margins and gearing up for a sturdy ramp-up to 12,000 tons per day within the midterm. We’re making certain full funding for our progress tasks and sustaining capital expense.

Thanks on your consideration. I’ll hand the decision again to the operator to open the road for questions. Operator, please go forward.

Query-and-Reply Session

Operator

Thanks, sir. [Operator Instructions] And right this moment’s first query, it comes from Cesar Perez-Novoa with BTG Pactual. Please go forward.

Cesar Perez-Novoa

Sure. Good morning to everybody and congratulations on your outcomes, by the way in which. So I’ve three questions, if I’ll. My first one pertains to your materials operational enchancment within the ultimate quarter of the yr, which amongst a number of operational enhancements and, after all, Yumpag, led to an import rise in working efficiency within the EBITDA. How ought to we take into consideration prices in 2024? And would the EBITDA that was reported within the ultimate quarter of the yr be a brand new degree going ahead, after all, assuming secure costs? Might you touch upon the sustainability on prices? That may be my first query.

The second relates if there’s any scenario on any of your direct operations that may encounter some kind of upkeep downtime in 2024. If this might be the case, which quarter and for which operation? And eventually, there’s an article in media that just lately resurfaced that claims that Cerro Verde plans to execute a collection of modifications in its manufacturing unit for an funding of round $646 million. If this might be the case, what is going to this particularly contain? And would this suggest some growth on the concentrator? When you might share some views on that and maybe manufacturing steering for Cerro Verde and CapEx, that will be extraordinarily — I might be extraordinarily grateful.

Leandro Garcia

Thanks, Cesar on your questions. Nicely, we foresee the associated fee to take care of by way of copper and gold in step with 2023 final quarter’s price. By way of any scenario that might have an effect on our any of our models, we now have to say that in Coimolache, we expect a allow that may permit us to proceed the works and piling within the pad. Extra particulars, possibly Daniel and Juan Carlos can provide you extra coloration to your query.

Juan Carlos Ortiz

Thanks, Leandro. That is Juan Carlos. Thanks, Cesar, on your query. Sure, as Leonardo was mentioning, relating to the prices, working prices on copper and gold, we foresee sort of a secure price from what we now have reported in 2023 coming in line in 2024. Within the case of silver, as a result of now we now have a full yr with manufacturing in Uchucchacua mine and in addition in Yumpag, we foresee a discount from what was in 2023.

Possibly the [indiscernible] of $19 per ounce of silver in 2023 most likely coming down nearer to $16 per ounce of silver in relative models. That’s going to be alongside the yr as a result of we’re ramping up manufacturing in Uchucchacua and we’re stabilizing manufacturing particularly tasks in operation in Yumpag. So it will be a [indiscernible] in price of those two models for silver manufacturing.

Relating to the potential downtime in any of the models, as a possible danger, so with a delay within the permits in Yumpag that we foresee for finish of the primary quarter however most likely might make per week or two later, that is an operational danger, hopefully not. And within the case of Coimolache, additionally anticipating some permits with a purpose to construct the growth of pads to proceed with our leaching operations, so additionally relying on that.

Our steering additionally consists of the case that we’re delaying this development in Coimolache of the pads. So any advance or any speed-up of the undertaking can be a web achieve on the anticipated manufacturing in opposition to our steering that was revealed a few weeks in the past.

Cesar Perez-Novoa

Okay. Thanks.

Daniel Dominguez

Okay. Second so as to add to what Juan Carlos mentioned, within the fourth quarter, Cesar, we had a really robust EBITDA. Within the first quarter of this yr, we may have Yumpag paralyzed for a few months. So it will impression the EBITDA of the quarter. Nonetheless, for the complete yr, we count on a complete EBITDA of round $220 million, $240 million.

Cesar Perez-Novoa

All proper. Thanks, Daniel.

Operator

Thanks. And our subsequent query right this moment comes from Carlos De Alba with Morgan Stanley. Please go forward.

Carlos de Alba

Yeah. Thanks very a lot. Good morning, everybody. Simply possibly only a very fast follow-up to Cesar’s query and to your response on the EBITDA for the yr, below what commodity costs, Daniel, are you forecasting this $200 million to $240 million?

Daniel Dominguez

Hello, Carlos. Thanks on your query. The costs that we’re utilizing to those estimates are for gold, $1,900; for copper, $8,500; and for silver, $23 per ounce.

Carlos de Alba

All proper. Okay, Daniel. So the questions I’ve, one, I am going to simply point out separately after which we are able to have a dialog. One is on the — are you able to possibly present just a little bit extra coloration on what you probably did within the earnings launch relating to the SUNAT scenario, the tax dispute with the SUNAT? Mainly, I understood you took $112 million — $113 million provision. It is noncash since you already made that fee. However does this point out that the chance of possibly profitable the case has diminished? How do you see the angle of your probabilities of finally profitable the case? The place are we within the authorized course of? And what comes forward? What are the subsequent steps?

Leandro Garcia

Thanks, Carlos, on your query. Really, we now have registered this provision due to the — based mostly on the opinion of our legal professionals, the chance to win within the case is decrease than 50%. So we — accounting customary, we must always register this write-off. The case just isn’t lifeless. We proceed a second part that can be within the constitutional court docket. So in that stage, we count on to recuperate our place and the trial ought to return to the Supreme Court docket. That is for under the — part of all of the trial of the method and means relating to the years ’09 and ’10. So there’s plenty of time to count on. And we must always — it is an ongoing information.

Carlos de Alba

Okay. And so the subsequent step is so that you can file, I suppose, an enchantment on the — within the constitutional court docket, proper? However would you haven’t completed that? And if you have not, when do you intend to do that? And usually, is there any rule of thumb, any expectation as to how lengthy the method on the constitutional court docket might final?

Daniel Dominguez

Carlos, we now have already completed this in December. And we expect within the following months to have a solution from the SUNAT.

Carlos de Alba

Okay. After which my subsequent query is on Yumpag and the permits. You talked about within the press launch that you simply count on to obtain them within the first quarter. How sure are you of this? Do you’ve gotten any indication that it might — this doubtlessly might be delayed into the second quarter or third quarter? Sure, how assured are you that Yumpag would begin actually ramping up once more within the second quarter?

Leandro Garcia

Nicely, by way of permits, that the nation, the administration is attempting to make efforts to provide to all of the directors to have shorter instances to run the permits. We’re — in a each day foundation, we now have conferences with the organizations and the authorities to take all of the questions that they’ve to permit us to have this to be granted of this allow as quickly as attainable. We’re making all of the efforts to have it earlier than the yr — the quarter finish of this yr. Chances, I can not let you know. However make certain that we — this is among the — our each day jobs that we now have to do, our each day targets.

Carlos de Alba

Truthful sufficient, Leandro. Simply my final query for you, Leandro, or possibly, Roque or Raul, how do you envision this new part of the corporate with a really related second massive shareholder that now, my understanding is doubtlessly might obtain two seats within the Board of Administrators? How do you — how does this transformation the corporate? How do you see the corporate going ahead? And what do you count on by way of this relationship with Antofagasta?

Leandro Garcia

Nicely, Carlos, because the administration and all the company, we’re very snug with the marketing strategy and the technique we now have. Possibly we now have not talked with Antofagasta but. We simply acquired the approval of the shareholders to extend the variety of administrators. So we’ll see. We are going to count on our first assembly. Possibly, Roque, if you wish to add further remark?

Roque Benavides

They’re essential shareholders, and we respect all shareholders. They urged a few names. Mr. Iván Arriagada and Mr. Andrónico Luksic. And we’re proposing these names to the Shareholders’ Assembly for approval. I look ahead to a superb relationship. I occur to know Mr. Andrónico Luksic, the Founder, a few years in the past. And I believe the trade has plenty of respect for Antofagasta. So we hope to work collectively and in a really constructive method. There may be nothing greater than that.

Carlos de Alba

Thanks, Roque. Thanks, Leandro.

Operator

Thanks. [Operator Instructions] Immediately’s subsequent audio query comes from Tanya Jakusconek with Scotiabank. Please go forward.

Tanya Jakusconek

Nice. Good morning, everybody and thanks a lot for taking my questions. And Roque, if I can simply observe up on the Antofagasta, it appears out of your feedback that you have not actually sat down with them to see precisely what they need. I imply, we listened to their convention name by way of what they talked about. However I am extra curious about for those who’ve been in a position to have conversations with them.

Roque Benavides

Nicely, we — their curiosity basically, being a copper firm, is within the Peruvian market and within the copper belongings of Buenaventura. As you recognize, we now have Trapiche and we now have Coimolache, [indiscernible] La Zanja. Clearly, we now have Brocal and we now have an fairness participation in Cerro Verde. So that’s what they’ve informed us that’s their curiosity.

And they’ll take part as some other firm — in the event that they need to contribute to develop these tasks that we now have below growth, they must take part as some other firm as we’re speaking to individuals like Sumitomo or BHP within the case of Coimolache. However as shareholders, they are going to be a part of our Board and they’ll contribute with their data. And I believe it’s a plus for the corporate.

Tanya Jakusconek

In order that they had been curious about kind of your entire copper belongings. As a result of as you recognize, they’re largely open pit miners. In order that they’re additionally within the underground operations. And are they curious about Trapiche possibly being — serving to on the event like a BHP, such as you talked about? Would they have an interest on being a companion on Trapiche?

Roque Benavides

Nicely, if they’re , as some other firm, we’ll open and so they must signal DNA or I am appropriate? Sure, NDA, an NDA. And sure, why not? Antofagasta is a primary line firm and so they specialised in copper and, as you say, in open pit mine. So nothing extraordinary, Tanya, nothing extraordinary.

Tanya Jakusconek

Okay. No, I actually, actually respect that. Thanks a lot Roque for that. Can I simply ask possibly a few issues on just a few modeling questions from Daniel after which I need to come again to San Gabriel and Trapiche. Simply on the modeling facet, Daniel, ought to I be your 2023 degree for exploration, G&A and promoting bills and is {that a} related degree for 2024?

Daniel Dominguez

Sure, Tanya. For explorations, it is best to estimate round $45 million from brownfield explorations and an extra $10 million for greenfield. The D&A needs to be much like the primary to 3rd quarter of this yr. Keep in mind that within the quarters three and 4, we had an amortization of the deferred stripping asset at El Brocal. So if you wish to mannequin, it is best to take the D&A much like the primary two quarters of the yr.

Tanya Jakusconek

Okay. No, that is very useful. Thanks a lot for that. That’s useful. After which can I come again and ask about among the asset gross sales? After we had been on the Investor Day, and congratulations on promoting one little asset within the quarter, we talked about promoting among the belongings to assist fund the steadiness sheet on high of the Cerro Verde dividends that we’re receiving. The place are we on the Yanacocha royalty sale? I do know we had talked about it on the Investor Day, there have been 13 potential patrons. Are you able to simply speak about the place you see asset gross sales in Q1?

Leandro Garcia

Sure, Aldo, please go forward.

Aldo Massa

Okay. Thanks, Leandro. Sure, Tanya. We’re nonetheless within the strategy of promoting the royalty. We’ve acquired 5 nonbinding affords, February 15. The thought is to elect the one who move the ROFR of Newmont and possibly make a possible go to to Yanacocha on March — on the finish of March. And eventually, the thought is to obtain the binding affords on April 15 after which select one and go forward.

Tanya Jakusconek

Okay. So it appears as if Newmont just isn’t concerned. It is simply different gamers apart from Newmont and also you wish to finalize by April 15.

Aldo Massa

Yeah. That is the thought.

Tanya Jakusconek

Okay. After which I might like to come back simply to San Gabriel, if I might. I simply needed to know, I see the image of the camp, 1,000 beds. So is the camp completed? And what are the vital objects for 2024? After which on the Investor Day, we had been additionally informed that we might be getting up to date capital and working prices. Are you able to remind me whether or not that is coming?

Leandro Garcia

Sure, Daniel. I flip the microphone to Renzo, our Vice President of Tasks.

Renzo Macher

Hello, Tanya. The campsite is — we now have 1,000 beds prepared. And apart from these beds, we have already got one other 1,000 beds within the neighborhood of the undertaking. So that won’t be an issue. What you see within the image is finalizing sidewalks and finalizing the ability — emergency energy plant on the web site, these little issues which can be lacking. The primary contractor for metal piping and mechanical will arrive within the subsequent month. So we will have every part completed by that date.

Within the second a part of your query about what ought to we count on in 2024? Nicely, the primary concrete pour needs to be within the second quarter after which energy line development ought to begin as properly within the second quarter of this yr. Within the third quarter, we expect we will be beginning with electrical and sign contractor and at last ending the yr with an excellent advance with the water dam earlier than the wet season begins. And I believe your final query was in regards to the up to date CapEx. As Leandro was saying, we’re at the moment engaged on that. Within the subsequent quarter, we will be giving the particular estimate numbers.

Tanya Jakusconek

Okay. So while you report your Q1, so someday in April, the top of April possibly, we can be getting an up to date CapEx? And what in regards to the working price?

Renzo Macher

The OpEx, we’re going to be ending within the third quarter of this yr, in the direction of the top of…

Tanya Jakusconek

On the finish of Q3?

Renzo Macher

Sure.

Leandro Garcia

The replace in CapEx needs to be for the convention name of the second quarter.

Tanya Jakusconek

Convention name of Q2, so it will be someday in July.

Leandro Garcia

Sure.

Tanya Jakusconek

CapEx in July after which OpEx in Q3, so October?

Leandro Garcia

Sure.

Tanya Jakusconek

Okay. Thanks a lot for that, so we’ll look ahead to getting these. As a result of these numbers, as you recognize, are fairly stale. They have been there for a protracted, very long time. After which my ultimate query, if I can, is simply on Trapiche. I am simply desirous to know for those who began the general public meeting — sorry, are they nonetheless going to be beginning in Q2? And is the feasibility nonetheless on observe to the top of 2026?

Renzo Macher

So sure, we — our environmental impression evaluation was submitted and public assemblies ought to occur in April — within the April [indiscernible]. And sure, we’re nonetheless on observe for a feasibility examine in the direction of 2026. [Multiple Speakers] Go forward.

Tanya Jakusconek

Yeah. And wouldn’t it be truthful to imagine that after getting the feasibility examine in hand, that’s when you’ll be in search of a three way partnership companion?

Aldo Massa

Sure, Tanya. That is the thought. As quickly as we now have the feasibility examine completed, the thought is to decide on for a companion or search for a companion.

Tanya Jakusconek

Okay. Thanks a lot for taking all my questions. I might go on all day, however let me move it on to someone else. I actually respect it.

Operator

Thanks. And our subsequent query right this moment comes from Omar Avellaneda with Prima AFP. Please go forward.

Omar Avellaneda

Good morning to all. Thanks for the decision. I’ve a few questions. I suppose, I missed just a little a part of the decision, so possibly you’ve gotten answered this. However I wish to know what’s it wanted to have a completely operational Yumpag for the reason that second quarter of 2024? And my second query and final one is relating to Cerro Verde. What’s your expectations on CapEx for this unit on a [indiscernible] foundation for the subsequent three years? Thanks.

Leandro Garcia

Thanks, Omar. Thanks on your participation. By way of Yumpag, absolutely operations, we count on to start within the second quarter of this yr. We’re simply ready for the operational allow that permit us to renew the operations in Yumpag. Within the case of Cerro Verde, we now have reviewed the figures budgeted for this yr. And the CapEx right this moment that’s authorised and deliberate is round $300 million, in step with the CapEx that we now have been used to within the final couple of years. That’s the CapEx we all know right this moment. The opposite tasks are within the analysis, I hope — I believe.

Omar Avellaneda

Okay. So simply so as to add an extra query, this information that we noticed in Gestión associated to the $600 million of CapEx in Cerro Verde doesn’t change any at your entire views relating to dividends coming from these models, proper?

Leandro Garcia

Nicely, as I informed you, Omar, that information which can be showing in Gestión, it is at the moment in analysis, proper? The plan right this moment from the figures that we now have is that the CapEx for this yr is $300 million. We should always have extra data within the following conferences with them.

Omar Avellaneda

Okay, excellent. And if I’ll, one further query. This $600 million CapEx just isn’t solely for only one yr. I suppose, it might be for a few years, three years. It is not going to be disbursed in a single yr solely, proper?

Leandro Garcia

Yeah, it’s a sort of — it is a allow, it is an IPS (ph). And this IPS just isn’t for one yr solely.

Omar Avellaneda

Okay. Excellent. Thanks very a lot. Congratulations on the outcomes.

Leandro Garcia

Thanks, Omar.

Operator

Thanks. Women and gents, with that, we can be concluding right this moment’s audio question-and-answer session. I wish to flip the ground again over to Gabriel Salas, Investor Relations Officer, for any webcast questions.

Gabriel Salas

Thanks, operator. The primary two questions come from Isabella Pacheco from Financial institution of America. How do you see web leverage in 2024? What was the principle issue contributing to a optimistic EBITDA in fourth quarter 2023?

Leandro Garcia

So possibly Daniel will help us with that query?

Daniel Dominguez

Sure, Leandro. By way of the online leverage, we ended this 2023 with 2 instances web debt over EBITDA. As we talked about earlier than, we rely with a facility of various — with totally different banks of $200 million of revolving services that we’ll use after we want the money to fund San Gabriel within the brief time period. In all probability, we can be utilizing round $150 million from these services. And it will — as a consequence of this, the leverage ratio ought to come as much as round 3x, which would be the most that we count on by the top of this yr.

The second query relating to the EBITDA of the fourth quarter, there have been mainly three components. One is the sale of Contacto, contributed with round $38 million of — within the EBITDA. The second issue was the stronger manufacturing and quantity bought from El Brocal and at last the restarting operations at Uchucchacua and Yumpag that contributed with round 2.8 million ounces of silver to our P&L.

Gabriel Salas

Thanks, Daniel. The following query comes from Orlando Barriga from CrediCorp Capital. How a lot of Yumpag’s prices had been categorized as CapEx in the course of the fourth quarter 2023?

Leandro Garcia

Daniel?

Daniel Dominguez

Sure. There have been $10 million of growth prices that weren’t inputted to the price of gross sales as a result of we rely with an exploration allow. So the quantity for the next years to be amortized is $10 million.

Gabriel Salas

Thanks, Daniel. At the moment, there aren’t any additional questions. I wish to flip the decision over to the operator.

Operator

Thanks. That concludes the question-and-answer session of right this moment’s convention name. I wish to flip it again over to administration for closing remarks.

Leandro Garcia

Thanks, operator. Earlier than we end right this moment’s convention name, I wish to thanks very a lot for making the time to hitch us, and have a — once more, you’ve gotten an awesome day right this moment. Thanks very a lot.

Operator

Thanks. Women and gents, that concludes Buenaventura’s fourth quarter 2023 earnings outcomes convention name. We wish to thanks once more on your participation. It’s possible you’ll now disconnect, and have a beautiful day.