Coeur Mining, Inc. (NYSE:CDE) Q1 2026 Earnings Call Transcript

Coeur Mining, Inc. (NYSE:CDE) Q1 2026 Earnings Call Transcript May 7, 2026

Operator: Good day, and welcome to Coeur Mining, Inc.’s First Quarter 2026 Financial Results Conference Call. All participants will be in listen-only mode. Please note this event is being recorded. I would now like to turn the conference over to Mitchell J. Krebs, Chairman, President and CEO. Please go ahead.

Mitchell J. Krebs: Hello, everyone, and thank you for joining our call to discuss Coeur Mining, Inc.’s first quarter results. I will kick off with some highlights from the quarter followed by an update on several key strategic priorities in the wake of the recently completed New Gold transaction. I will then turn it over to Thomas S. Whelan for a recap of our first quarter results before opening it up for questions with the team who is here with me. Before we start, please note our cautionary language regarding forward-looking statements and refer to our SEC filings on our website. The highlights on Slide 4 showcase our strong start despite the first quarter being the softest quarter of the year. Our record results also reflect just 11 days of contributions from the recently acquired New Afton and Rainy River mines.

First quarter silver and gold production increased 1,811% year-over-year, respectively, driving quarterly revenue to $856 million. EBITDA increased 12% versus the fourth quarter and nearly fourfold year-over-year to a record $475 million. We generated a very strong $267 million of free cash flow despite over $200 million of quarter-specific and one-time items that Thomas S. Whelan will describe in more detail shortly. These accelerating cash flows continue to supercharge our balance sheet with cash and equivalents increasing nearly 11-fold over the past year to $843 million and growing. A real shout-out to the team for getting us out of the gates cleanly and safely in 2026. The production summary on Slide 5 provides the clearest portrait of what we expect will be a truly watershed year for the company.

Among many other positive catalysts on tap, the remaining three quarters will reflect full contributions from New Afton and Rainy River, rising production and cash flow from Rochester, and a strong rebound at Wharf now that its rebuilt crushing circuit is back up and running thanks to a tremendous effort by the team there following a fire in the building last November. Putting that all together along with consistent performance from our three other operations and taking the midpoint of our guidance ranges, we expect to produce approximately 750,000 ounces of gold, over 20 million ounces of silver, and nearly 60 million pounds of copper in 2026. The two new Canadian operations are the main drivers behind an expected 80% increase in our 2026 gold production compared to last year while also introducing copper into our metals mix and driving down our overall cost profile.

The 20+ million ounces of silver production we expect to generate this year represents about a 13% increase over last year driven by a full year of contribution from Las Chispas, which was added in mid-February last year through the Silvercrest acquisition, as well as a further expected step-up in production at Rochester. This level of silver production should keep us in the top five of all silver producers globally and is expected to represent over 30% of our revenue this year based on recent prices. It is also important to highlight that 100% of our 2026 gold, silver, and copper production will come from North America with about 70% of our revenues coming from the U.S. and Canada. A couple of other quick updates. You likely saw on March 23 that we provided a corporate update following the closing of the New Gold transaction that laid out an enhanced financial policy reflecting our priorities of establishing and maintaining a flexible balance sheet and reinvesting back into our assets, all while returning capital to shareholders through a substantially increased share repurchase program and an inaugural dividend, which Thomas S.

Whelan will talk more about shortly. On the integration front, we are very pleased with where we are after seven weeks since the closing. There has been an incredible amount of planning, effort, and collaboration throughout the combined organization which deserves a big thank you. The teams are engaging in the work of integrating the two companies and everyone is excited about the stronger and larger platform we have created and the tremendous potential that lies ahead. Before turning it over to Thomas S. Whelan, one final note from me. We published our 2025 responsibility report on April 15, which is summarized on Slide 23. Coeur Mining, Inc.’s approach has always been grounded in driving sustainable growth and long-term value creation, and we focused this year’s report on clearly tying our sustainability priorities to underlying business value.

Thomas, over to you.

Thomas S. Whelan: Thanks, Mitch. I will begin with a brief review of our first quarter financial results as presented on Slide 9. Record quarterly performance in revenue, EBITDA, and GAAP net income are just the latest signs of the emerging power and consistency of Coeur Mining, Inc.’s combined portfolio. Key headline financial results included a seventh consecutive quarter of free cash flow and an eighth consecutive quarter of positive earnings per share. This consistent track record of positive earnings and free cash flow, along with our new dividend policy, bodes well for future additional index inclusion. Our first quarter is always a little choppy, with our traditionally seasonally low first quarter operating performance and significant working capital outflows.

Add in the complexity of closing a transaction during the quarter, this led to a lot of moving parts in the quarterly results. We included a waterfall chart on Slide 11 where we called out quarter-specific and one-time items totaling over $200 million. However, with the tailwinds of stronger realized prices and a focus on monetizing the opening inventory balances at our newly acquired Canadian operations, we managed to achieve our second-highest free cash flow in company history at $267 million. Our day-one integration efforts have paid off, leaving us set up for a memorable 2026 as we emerge as the new go-to North American-only precious metals company. Slide 8 highlights the incredible turnaround story of our balance sheet. With last-twelve-month adjusted EBITDA increasing by over $1 billion compared to the same point one year ago, and an overall net cash position, along with the new, modernized, and materially upsized $1 billion revolving credit facility, the balance sheet and overall liquidity levels are in great shape.

Of note, our cash balance increased by almost $300 million during the quarter, more than offsetting the $272 million of net debt that was assumed at the closing of the New Gold acquisition. I would also highlight that we received multi-notch upgrades from our rating agencies as we completed the acquisition. It is external validation of the immense progress and stability we have built. A couple of final notes on the balance sheet. The obligor exchange related to New Gold’s 2032 bonds that we launched on the transaction closing was completed on April 22. This innovative transaction has allowed us to novate over 96% of the outstanding New Gold notes to become Coeur Mining, Inc. notes, which will provide significant benefits, including no restrictions on our ability to return capital, additional U.S. tax shield, and lower filing and compliance costs.

And on April 30, we repaid the bulk of our remaining $45 million of capital leases early to further reduce our overall interest expense going forward. With our 2026 guidance reaffirmed, using our 2026 budget prices, we expect to generate more than $3 billion of EBITDA and $2 billion of free cash flow as shown on Slide 7, even with only nine months and 11 days of contributions from New Afton and Rainy River. This overall confidence in the portfolio was the basis of the updated financial policy as outlined on Slide 10 for the company, including our return of capital strategy that we announced on March 23. As a brief reminder, our Board-authorized capital return strategy is comprised of a $750 million buyback program, which allows for the possibility of continuous activity even during blackout periods, as well as a discretionary component to allow us to execute repurchases opportunistically based on our underlying share price and valuation.

We look forward to executing on this program following several months of inactivity due to blackouts. And Coeur Mining, Inc.’s Board has also approved an inaugural dividend policy of $0.02 per share semiannually, with payments expected in the second and fourth quarters. This amount was selected to make the dividend sustainable for the long run even under extreme low-case pricing scenarios and allows for potential dividend growth over time. Two final comments from me. Slide 12 includes our usual snapshot of inflationary pressures that we keep a close eye on every day as we manage the business. In the wake of the recent surge in oil prices, we wanted to highlight that diesel represents approximately 6% of Coeur Mining, Inc.’s total operating costs, and our 2026 cost guidance assumes a diesel price of $3.19 per gallon.

A 10% increase in diesel prices would typically increase our cost by about $10 million, which equates to roughly a 1% to 2% increase in our CAS per unit. So while we are not immune to this cost pressure, it is less acute than most people might think. During the March 23 call, I highlighted several accounting nuances that impact our CAS guidance with a special focus on the fair value uplift of opening inventory that arise from the purchase price allocation from the New Gold acquisition. With all of Rainy River and New Afton’s Q1 2026 sales coming from opening inventory, the CAS for the quarter at those mines approached current spot prices as required under U.S. GAAP, as those inventories were recorded at their fair market value. As a reminder, the associated $85 million non-cash impact on CAS during the quarter from this pointy-headed accounting matter is the same concept that we saw at Las Chispas last year.

Our overall company-wide adjusted gold CAS would have been $689 less per ounce to give everyone a sense of the significant accounting impact of this non-cash item. The champagne problems of having so much opening inventory. This nuance will carry throughout 2026 at Rainy River as we are fortunate to inherit an approximate 2 million ton short-term stockpile. We will likely have some tweaks to the final non-cash impact of this fair value uplift that we will clarify with our Q2 2026 interim results as we finalize New Gold purchase price allocation. With that, I will now pass the call back to Mitch.

Mitchell J. Krebs: Thanks, Tom. Before opening it up for Q&A, as shown on Slide 20, our key strategic priorities for the year ahead remain unchanged. I am very proud to report that Coeur Mining, Inc. finished 2025 as the safest mining company among our peers in the United States for the fourth consecutive year based on MSHA data. Congratulations to the entire team for having the courage to care and for always pursuing a higher standard when it comes to our commitment to keeping everyone safe. I am also extremely pleased to announce that both New Afton and Rainy River received the John T. Ryan regional safety trophy for lowest reportable injury frequency earlier this week at the annual CIM conference. New Afton has received this award 11 out of the past 12 years while Rainy River is a first-time recipient.

Our leadership in the safety and environmental areas are two great examples of how we at Coeur Mining, Inc. set the bar high and then strive to exceed our expectations. As we look out over the remainder of the year, we will continue working tirelessly to complete a smooth integration of New Gold and to deliver consistent and predictable performance across our expanded and strengthened platform of seven North American operations. Another key priority will be to continue bolstering our liquidity while making the transition to returning capital to shareholders through our new share repurchase program and initial dividend policy. Carrying out the largest exploration investment in the company’s history and delivering impactful results from these programs will remain a top focus over the remaining nine months of the year.

This includes continued drilling at the Silvertip project in British Columbia, where the higher silver price, Canada’s strong support for critical minerals projects, and our own ability to advance this one-of-a-kind silver asset are all coming together to create a potential window of opportunity. Much work remains to be done and we look forward to sharing our progress there later in the year after the busy summer drilling season. Starting with this current quarter, we are excited to begin delivering the tremendous potential of the company that we have built through our recent investments in exploration and expansions and two well-timed, high-impact M&A transactions. I cannot think of a better-positioned company in our sector given our production and cash flow profile, metals mix, growth, geographic footprint, trading liquidity, balance sheet, and, most importantly, the team to deliver it.

We will now open the call for questions.

Q&A Session

Operator: We will now begin the question and answer session. First question comes from Cosmos Chiu with CIBC. Please go ahead.

Cosmos Chiu: Great. Thanks, Mitch and Tom and team, a very good presentation. Maybe my first question is on the free cash flow. You kind of touched on it, some Q1-specific items, $200 million, and it is in Slide 11. But could you maybe elaborate on it? I just want to make sure that these are nonrecurring. It will not come up again in Q2. Maybe it will come up in Q1, the Mexican taxes. But certainly will not be recurring for Q2, Q3, and Q4.

Mitchell J. Krebs: Yes. Hi, Cosmos. It is Mitch. Thanks for the question. I will ask Tom to say something here in a second. Just high level and you referenced Slide 11 which is a great place to talk about this. Each first quarter, you are really not going to get away from the Mexican tax payments, the interest, and the Rochester property tax. The others were one-time. I mean, the incentive payment is variable year to year. Strong performance last year led to a larger annual incentive payment in the first quarter of this year. And obviously, the tax payments were higher than they have been in recent years due to the last season last year and just overall strong performance from both Palmarejo and Las Chispas. But Tom, anything else you want to add to that?

Thomas S. Whelan: Yes. The only thing I would add is just the way we time the interest on the notes. Those will happen in Q1 and Q3. But the rest are only going to happen in Q1. And obviously transaction costs were a one-time.

Cosmos Chiu: Perfect. Thank you. And then maybe if I can ask about the capital return program. And Mitch, great to see the dividend now in place and now the $750 million repurchase program in place. I went through the MD&A. It does not seem like you have utilized the share buyback program just yet. Is that something that you look forward to doing sometime in 2026? Is it dependent on free cash flow coming in, dependent on Coeur Mining, Inc. share price levels and—

Thomas S. Whelan: I guess, number one, to confirm that it has not been used, number two, would—

Cosmos Chiu: —would it get used sometime in 2026?

Mitchell J. Krebs: Yes. Thanks for the question. Absolutely. We look forward to enacting that enhanced repurchase program. We have been constrained with blackouts from the New Gold transaction and from the first quarter. Those now will lift after today. So we look forward to becoming more active here starting in the second quarter and beyond on that repurchase program.

Cosmos Chiu: Understood. Sorry to come back to this PPA in terms of purchase price accounting to inventory, but I am just trying to wrap my head around it. I understand it has been marked up to market, but the New Afton number over $4,000 in CAS, again Rainy River over $4,000 in CAS, that seemed fairly high. So as we go into Q2, Q3, Q4, is it going to be dependent on how much is being drawn out of inventory versus how much fresh ore you are supplementing the inventory production with? Is that going to be determinant in terms of what CAS looks like each and every quarter? And the 11 days of over $4,000 an ounce CAS was just a function of it being all inventory and maybe just an anomaly over 11 days?

Mitchell J. Krebs: Yes, you got it. And no need to apologize for the question. You made Tom’s day. Tom, do you want to take that?

Thomas S. Whelan: Sure. So let us go asset by asset. For New Afton, think of that as pretty much we have flushed everything out there from the opening WIP and finished goods through those first 11 days. So that $20 million impact, which was $25.60 on the CAS and $3.10 on copper because it is co-product, should be in the rearview mirror. But again, as I referenced at Rainy, it is the champagne problem. We inherited, just to give you a sense, like 30 thousand ounces of gold in finished goods and doré balances at the end of the quarter on acquisition, as well as, as I referenced, a 2 million ton stockpile. So that is well over $400 million of fair value of gold. And as I mentioned, we are finalizing that purchase price allocation exercise here in the second quarter as we are allowed to.

So $65 million of that flowed through. There will be a continuing impact through Q2 and Q3, and as we get a little bit more visibility on exactly how quickly we will draw that down and chew through that stockpile, we will be able to give you a little bit more guidance. But I just want to keep going back to this is just pointy-headed accounting. It definitely impacts our earnings, but does not impact free cash flow.

Cosmos Chiu: Great. Thanks, Tom. And maybe one last question in terms of operations. Q1, Rochester and Wharf were impacted by certain issues—maintenance at Rochester and, of course, the fire at Wharf. Just to confirm, it sounds like the issues are behind you. It sounds like all the fixes have now been put in place. And so for Q2, Q3, and Q4, should we expect more normalized levels in terms of tonnage and throughput at Rochester and Wharf?

Mitchell J. Krebs: Yes. I will start, and then Mick can clean up anything that needs to be cleaned up. If you go back to the guidance that we put out in February in that investor deck, we laid out the production profile by quarter by mine. For Wharf, you could see the first quarter was by far the weakest and then continuing strength throughout the rest of the year. Looking at our results from the first quarter, Wharf was actually just a little ahead of that profile that we laid out back in February. The team has done an amazing job there of getting back up and going. We feel good about that continued progression through the remaining three quarters of the year to land within the full-year guidance range that we put out back in February.

Similar story at Rochester. It was a little ahead of plan when you look at expected first quarter versus actual. When you think about some of the things going on on the ground there from the crushing standpoint, the first quarter has fewer days in it than any other quarter, there was some scheduled downtime for maintenance, and there was a lot of over-liner being crushed in the first quarter to go out onto the Phase 2 Stage 6 leach pad. A few of those things were going on in the first quarter, but we expect to see things continue to build there as well through the year to land within the guidance ranges that we put out in February. Mick, anything I failed to mention?

Mick Routledge: No. Perfect. [inaudible] building momentum throughout the year as per that quarterly breakdown in the plan. Particularly at Wharf, the team did a fantastic job at that recovery curve and got really a couple of weeks ahead and already right on plan for the year. At Rochester, we knew that was going to be a shorter quarter with a little bit less grade, and we will see that picking up throughout the year. Right on plan and super happy.

Cosmos Chiu: Great. Thanks again, Mitch, Tom, and Mick, for answering all my questions. Congrats on getting the deal done and a strong start to 2026.

Mitchell J. Krebs: Thanks a lot, Cosmos. Appreciate it.

Operator: The next question is from Joseph Reagor with Roth. Please go ahead.

Joseph Reagor: Hey, Mitch and team. Thanks for taking my questions. Some of them were just answered, but I did have one question, which is probably for Tom. On the balance sheet, the deferred income tax jumped from $300 million to $3.15 billion. I am assuming it is all related to deferred income tax that New Gold had on their balance sheet previously, but is there anything we should think about there? And then with the accounting around the change in the notes, is there any impact to deferred income taxes accounting?

Thomas S. Whelan: I am blushing with all the accounting questions. It is exciting. Thanks. On the debt, good astute observation. It is carried on the books at $425 million, but the face value is only $400 million. Again, the rules require you to estimate the fair value and so, just given that higher coupon that those notes bear at 6.875% versus what our market rate would be, you record that at a little higher value. But the bigger impact is what you talked about: deferred tax liability. Again, this is all driven by the accounting rules. For the purchase or the mineral interests that we have acquired and all the various equipment, etc., those have been recorded at very high value as we went through our valuation exercise. But the tax basis of those assets remains at whatever New Gold’s tax basis was.

So that creates a difference between the accounting value and the tax value. You take that difference and multiply it by the Canadian tax rate, and there you have it. So that liability is going to reverse over time similar to what we saw last year at Las Chispas where we had a large tax liability, and that will reverse slowly but surely as the accounting values and the tax values get closer and closer. But that will take literally ten years to reverse out. Thanks for the question. I hope I gave you a good explanation. This is not additional hidden taxes in New Gold’s books or anything like that. It is just driven by the accounting for the purchase price.

Joseph Reagor: That was very helpful. And then, big picture, you do have a plan of how to redeploy capital. If you look at the balance sheet, slightly net cash as of the end of the quarter, how aggressive do you want to be on reducing the rest of the debt?

Mitchell J. Krebs: Yeah. I think both of the notes, the New Gold notes and then our 5.125%, are pretty low interest, pretty patient, pretty flexible. As you think about allocating capital to the highest returns, those are not going to be anywhere near the top of the list. For now we are fine and comfortable leaving them alone, letting cash build up a bit, getting to a more appropriate level of overall liquidity, and then keeping an eye out for ways to reinvest the excess cash back into the business. We talked about our largest exploration program in company history, so we are being aggressive on that front. We will look at things like Silvertip, of course, K-Zone out there in the future. But as far as those outstanding notes, we are comfortable leaving those alone for now at least.

Joseph Reagor: Okay. Thanks. I will turn it over.

Mitchell J. Krebs: Okay. Alright. Thanks, Joe.

Operator: The next question is from Joshua Wolfson with RBC. Please go ahead.

Joshua Wolfson: Thank you very much. I guess my questions are on the New Gold assets. I know there is not a huge amount of data here to go through given the short period between closing and the end of the quarter. First question just on Rainy. Within the data that was reported, production looked relatively good. Grade was lighter relative to what the recent technical report would have discussed. I think it was something like 1.2, 1.3 grams, and the processed material is only 0.9. How should we think about the quarters going forward? Or is there some change on stockpile processing versus what the technical report says? Thank you.

Mitchell J. Krebs: Sure, Josh. Thanks for the question. I will start and the team can fill in. On Rainy River specifically, late in the second half of last year Rainy River had some really high-grade open pit material that drove some exceptional performance in the third quarter and the fourth quarter. Our grade profile this year reflects a lower grade open pit profile but increasing over the year. The other big theme is seeing the underground mining rates step up over time and transition to more of a balance in the second part of the year between open pit and underground. As far as those open pit grades in particular, yes, a little bit lower to start the year, according to plan. As you said, very small dataset there with just the 11 days, but that should build a bit over the remainder of the year.

Thomas S. Whelan: I would point back to the guidance in February where we give it by quarter. You will see Rainy should have a bit stronger second quarter than third quarter and then a pretty solid fourth quarter based on the mine plan as it stands. It is going to be a very significant free cash flow generator, and we are really excited.

Mick Routledge: And just from a technical report perspective, clearly technical report grades are on an annual basis, and we try to break that out into the quarterly profile to help show how we are going to perform from one quarter to the next. From Q2 to Q4 post-close, we expect to be around the grade profile that was planned.

Joshua Wolfson: Got it. Okay. Good to hear. And then on New Afton, with the C-Zone final draw bell blast done, how should we be thinking about the ramp-up there? Anything you can walk us through in terms of expectations—maybe execution risks and how the company is managing that? Thank you.

Mitchell J. Krebs: Also a back-half year expected there at New Afton on the back of that C-Zone ramp up with B-Zone now behind them as of the end of last year. The target is to be approaching that 16 thousand ton-per-day throughput as we end the second quarter. We started in March and early April more around 11 thousand tons per day. We will be targeting 16 thousand tons per day in the coming months, and that will drive a much stronger back half of the year there to land within the gold and copper guidance ranges that we issued. Mick, anything else there?

Mick Routledge: Mitch nailed it. Since the close, it has actually trended up a little bit, so it is definitely gaining momentum. We got around a 13 thousand ton-per-day average post-close alone. It is getting stronger, and we expect to be in and around 16 thousand tons per day at the end of Q2, the way it is trending at the moment.

Joshua Wolfson: Great. Those are all my questions. Thank you.

Mitchell J. Krebs: Okay. Thanks, Josh.

Operator: The next question is from Brian MacArthur with Raymond James. Please go ahead.

Brian MacArthur: Good morning and thank you for taking my question. Can I just go back to the— I hate to do this—the accounting again? You talked about how everything at New Afton flushed, which is good. But then you made a comment too that you had 30 thousand ounces on the books of gold as well as material on the pad at March 31. Those 30 thousand ounces—is that going to be additional cash flow that you liberate out of working capital over the next few quarters? I.e., it is over and above the guidance that you have given this year for Rainy River, just so I am clear on this?

Thomas S. Whelan: I will go ahead. No. The guidance includes the monetization of this stockpile and the work in process. So no, stick with the guidance; that is in there. The key, of course, is that those ounces that come out of the inventory are going to be at the higher CAS rate, but it is not going to impact free cash flow.

Brian MacArthur: Right. So you are just going to bring them up. There is no extra cash being liberated is what I am getting at here.

Mitchell J. Krebs: Correct.

Brian MacArthur: Perfect. Thank you. Second thing, you also made a comment about, with restructuring the New Gold debt, it helped your tax structures. I did not quite hear that clearly. Is that U.S. tax structure? Or by doing that, does that help you on your Canadian side as well?

Thomas S. Whelan: Again, the obligor exchange that closed on April 22 will novate the 2032 New Gold bonds out of the Canadian entity and into the U.S. entity. We will get that tax shelter against our U.S. income, not the Canadian asset.

Brian MacArthur: Traditional U.S. Okay. That is what I was trying to figure out.

Mitchell J. Krebs: Thanks very much. And again, this is going to make—

Thomas S. Whelan: —it is going to make the rating agencies’ lives easier because they are not going to have to rate two bonds. Most importantly, it has removed constraints; we have full financial flexibility around return of capital. If not, it was going to be a little cumbersome to deal with those two different indentures. Great work by our treasury and legal teams who executed that extremely swiftly, and we are really pleased to have seen such a large uptake on the amount of folks who took advantage of it.

Brian MacArthur: Great. Thanks very much, Tom. That is very clear.

Operator: Next question is from Wayne Lam with TD Securities. Please go ahead.

Wayne Lam: Yes, thanks, guys. Just a couple of follow-up questions. First one, some really good color that you provided on the overall diesel exposure. But more specifically at Rochester, that would seem to be where you would have the most exposure just given the scale of the mine. What kind of cost pressures might you be seeing there specifically on the energy front? And do you have any more detail on the timing of planned maintenance activities on the crushers through the year?

Mitchell J. Krebs: Yes. Thanks, Wayne. I appreciate the questions. Tom and Mick, I will throw it over to you on the Rochester-specific diesel question, and then maybe you can also hit Wayne’s second question around maintenance timing relating to the crusher out there.

Mick Routledge: Yes. On the diesel front, the biggest exposures are the open pits: Rochester, Wharf, and Rainy River. But the overall impact around the total cost—and Tom can weigh in on the percentages here—is not too significant. We are not seeing too much from Q1 flowing through into Q2, but clearly we are watching that very carefully. On Rochester’s maintenance program, the bigger shutdown is toward the early part of Q4 of this year where we are going to do some work around feeders on the secondary of the crusher. That is also built into the profile and the plan, so you will see that in the quarterly profile. The Q4 projection is accurate. The rest are short routine maintenance shutdowns—one, two, three days to change cones and other bits and pieces that are all planned and will continue each year.

Thomas S. Whelan: And Wayne, the only thing I would add is absolutely Rochester and Rainy River are the two assets where we spend the most money to produce all the amazing amounts of gold and silver that we are forecasting. We have a team that is laser-focused on monitoring this—robust monthly reviews, cost reviews, looking out ahead, understanding when contracts are expiring—to keep a really close eye on that. I feel really comfortable that we are monitoring it as best we can. So far, so good.

Wayne Lam: Okay. Perfect. Maybe just to follow up on that one. You said there was maintenance planned in Q4, and that is already baked into the quarterly guidance where you have a pretty big step change in production in the last quarter of the year.

Mick Routledge: Correct.

Wayne Lam: Okay. Perfect. And then my only other question was on the labor cost front. Again, a lot of good detail on the inflation that you are seeing. What kind of exposure or breakout on the labor cost pressures are you seeing between the U.S. operations versus Mexico?

Mitchell J. Krebs: I will start, Wayne. The inflationary cost pressure slide in the deck, Slide 12, that bottom-left bar chart shows year-over-year increase of something like 15%. A decent amount of that is incentive comp, higher year-over-year. I just wanted to flag that. As far as labor pressures in Mexico versus the U.S., I think we are seeing it more in the U.S. context versus Mexico. But Mick, Tom, do you want to provide any more detail or context?

Mick Routledge: General levels of turnover and who we need to recruit—no shortfalls in labor availability. It is just that general mining turnover rate and recruitment performance is normal. Not feeling too much pressure there at the moment. From a cost perspective, as Mitch said, we are focused on that and seeing a little bit of increase in cost, but nothing unusual for Mexico.

Thomas S. Whelan: And the first quarter is the quarter where you implement base salary increases. Those have happened. Typically, if you have really undercooked salary increases, people get their bonus and then head off the other way. We are feeling really comfortable for now. For what it is worth, we do a midyear review just to make sure that we are keeping an eye on labor rates. As we all know, you need the bodies to deliver all this production safely and profitably.

Mitchell J. Krebs: Good point, Tom. And Mick, on the turnover rates, we have not seen an uptick at all. In fact, we have seen things go the other way.

Wayne Lam: Yep. Okay. Perfect. Well, hopefully we see that same year-over-year share price performance, so you will be paying out those incentive bonuses again next year. Congrats on a good quarter, guys.

Mitchell J. Krebs: Thanks, Wayne.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Mr. Krebs for any closing remarks.

Mitchell J. Krebs: Thank you for your time and all the great questions today. We look forward to getting back together again this summer to talk about our second quarter results, which should really start to reflect the power of the platform, and we can share our progress on what should be a record-breaking 2026. Thanks again for your time. Have a good day.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.