The following is a summary of the Hudbay Minerals Inc. (HBM) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Hudbay Minerals reported strong financial and operational performance in Q3 2024, with significant free cash flow generation and continued debt reduction.

• Recorded $186 million in operating cash flow, a 53% increase from the previous quarter, and $206 million in adjusted EBITDA, a 42% increase from the previous quarter.

• Consolidated gold production reached 89,000 ounces, exceeding expectations with a 52% increase from Q2, significantly contributing to financial results.

• Achieved further gross debt reduction of nearly $300 million over the past 12 months, enhancing balance sheet resilience.

• Adjusted earnings per share was $0.13 in Q3, and the company generated $86 million in free cash flow during the quarter.

Business Progress:

• The New Britannia mill in Manitoba achieved record gold production and throughput, highlighting successful operational advancements.

• Continued progress on the Copper World project, with significant developments in permitting and planning for future phases. Advanced discussions on forming a potential partnership for project funding.

• Ongoing improvements in milling and mining processes at Copper Mountain, with a focus on increasing throughput and decreasing costs.

Opportunities:

• Hudbay plans to capitalize on higher metal prices through its diversified production of copper and gold, which adds resilience to cash flow.

• The 3-P plan supports future growth, particularly around the Copper World project, preparing it as a significant future asset with potential joint venture partnerships.

• Regulatory changes allowing increased throughput at mining operations provide an opportunity to boost production levels and improve operational efficiency.

Risks:

• The guidance for 2024 copper production trends towards the lower end of expectations due to lower-than-expected ore grades.

• The gold production forecast remains robust, trending towards the upper end of the guidance range, reflecting favorably on operational adjustments and market conditions.

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