Earning Date, Transcript Summary & Report

Record Adjusted EBITDA Achievement: Achieved the second highest adjusted EBITDA in company history, totaling $714 million for the full year 2024, driven by higher by-product contributions and increased zinc prices.

Positive Cash Flow Achievement: Generated positive consolidated cash flow for the first time since initiating the investment cycle in Aripuanã, reflecting improved financial health.

Financial Position Enhancement: Improved financial position with a notable increase in cash balance and a reduction in gross debt, resulting in a net leverage ratio improvement from 2.2 times to 1.7 times.

Q4 Adjusted EBITDA Surge: Fourth quarter adjusted EBITDA reached $197 million, a 79% increase from the same period last year, indicating strong operational performance.

Q4 Revenue Increase: Total consolidated net revenues for Q4 reached $741 million, an 18% increase year-over-year, showcasing revenue growth.

Production Guidance Achievement: Met annual production guidance for zinc, lead, and silver, while copper production exceeded expectations, demonstrating operational efficiency.

Portfolio Optimization Strategy: Significant progress in optimizing the portfolio through strategic divestments, allowing focus on high-return assets.

Cerro Pasco Integration Approval: Approved the first phase of the Cerro Pasco integration project, enhancing operational efficiency and extending the life of the mining complex.

Zinc Production Surge: Zinc production at Aripuanã increased by 43% year-over-year, with significant growth in lead and silver production as well, reflecting operational improvements.

Strong Liquidity Position: Maintained a strong liquidity position with approximately $960 million available, including an undrawn $320 million credit facility, ensuring financial flexibility.

Investment-Grade Ratings Reaffirmed: Reaffirmed investment-grade ratings from Standard & Poor’s and Fitch, highlighting the company's financial discipline and resilience.

Dividend Policy Enhancement: Implemented a new dividend policy aimed at enhancing transparency and providing consistent returns to shareholders, reflecting commitment to shareholder value.

Zinc Production Decline: Zinc production decreased by 11% quarter over quarter and 19% year over year, primarily due to lower output at Cerro Lindo and the absence of contributions from Morro Agudo.

EBITDA vs. Cash Costs: Despite an increase in adjusted EBITDA, the mining cash cost slightly increased by $0.01 per pound compared to the third quarter due to lower zinc volumes.

Increased Smelting Costs: Total smelting costs increased to $1.26 per pound, up from $1.00 per pound in the same period last year, driven by higher raw material costs and lower treatment charges.

Operational Challenges Overview: The company faced operational challenges at Aripuanã, including an 8% reduction in treated ore volumes due to above-average rainfall and a scheduled maintenance shutdown.

Zinc Production Decline: The overall zinc production for the full year was 2% lower compared to 2023, indicating a decline in production efficiency.

Foreign Exchange Impact: The company reported a negative effect of $11 million on cash and cash equivalents due to foreign exchange variation, primarily from the depreciation of the Brazilian real against the US dollar.