Aura Minerals (AUGO) Nordic Funds & Mines Conference 2024 summary

Strategic vision and operational footprint

• Emphasizes a holistic, 360-degree approach to mining, focusing on high returns and sustainable growth in the Americas.

• Operates four mines, with one under construction, one in development, and two exploration projects, primarily in Brazil, Mexico, and Honduras.

• Maintains a 30% copper and 70% gold production mix, with ongoing efforts to expand copper exposure through exploration.

• Leverages local expertise and cultural familiarity to streamline project implementation and community relations.

• Aims to increase mine life and production capacity through internal exploration and targeted acquisitions.

Financial performance and capital allocation

• Achieved 6% dividend yields in 2022–2023 and 8.8% in the last 12 months, with a stable long-term target around 6%.

• Focuses on cost reduction, operating in the second quartile with ambitions to reach the first through new low-cost projects.

• Recently issued a $100 million local bond in Brazil at 6.5% to refinance debt, extending amortization and maintaining low leverage at 0.8x.

• Maintains a dividend policy of 20% of EBITDA minus sustaining CapEx, supported by strong cash flow and a major shareholder holding 55%.

• Prioritizes projects with returns above 30%, aiming for profitability over sheer production scale.

Project development and growth initiatives

• Targets 450,000 ounces annual production in three years and 1 million ounces in ten years.

• Almas project reached commercial production in four months, built on time and budget, now increasing capacity by 10%.

• Borborema, the largest project, is 45% complete and expected online in early 2025, with potential to double size by relocating a federal road.

• Matupá project announcement postponed to next year to incorporate new exploration data and optimize project scale.

• Exploration success has doubled reserves and tripled resources in five years, with further growth expected from M&A.