Thank you, Leo. Good afternoon, everybody. I'm not used to having such a big crowd, so I'll try to get to the point. I'm really happy to get the chance to present to you Dynacor, who we are, and I think that you'll see over the next few minutes that we have a unique business model, if I can put it that way. Again, maybe I'll just run through the slides and we'll be happy to take questions later on. Let me just see if I'm doing this the right way.
Of course, like any publicly traded company, we have caution regarding forward-looking statements. I just want to make sure everybody's aware of that. Welcome. Please, have a seat. I'm just starting anyways, I don't need to repeat. Again, I'm happy to present to you the company today. Who are we? Maybe just starting off with regards to Dynacor, who are we? First, we like to use a phrase internally where we are a miller, not a miner, and I'll explain to you a bit more as the presentation progresses.
If you look at who Dynacor is, really for several years, actually almost close to three decades, we're an established company in Peru. Montreal-based, but operations in Peru. What does that mean is, by the way, we're the only publicly traded company doing this type of work, which is again, being a processor of gold and silver, which I'll explain to you a bit more, as a listed company around the world. We differentiate our business and I'll show you in the next few slides with regards to our competitive advantage.
We have a solid track record for some of you who have had the chance to look at who the company is on the TSX under DNG, you can follow the information about our company. We've been listed for well over a decade. Again, right now we're leveraging our operations in Peru. Again, 30 years of experience as a processor, to which now we're expanding in new territories, which is Ecuador and Senegal.
Of course, we're looking at that expansion strategy, if I may, really to set the stage because, again, I'll showcase there's a huge potential with regards to milling gold or silver, where actually the only client base that we have is artisanal miners that are formalized or either in the formalization process. What does that mean, formalization process? It means that those individuals or those companies are registered with regards to a country's regulations.
In other words, they are registered companies. Again, very quickly, who is Dynacor? This diagram shows you our operational process. In a nutshell, again, like I was saying earlier, we buy all of our minerals, the raw minerals, from artisanal miners. In other words, in Peru, for example, over 30 years, we've garnered, call it a database of over 750 suppliers.
We don't deal with them every single day, don't get me wrong, but we've developed a one by one, call it trustworthy relationship, where they actually sell to us their minerals on a given day and all that. All this, of course, is based also on some very key fundamentals from a company perspective is traceability.
Traceability for us is key because it's also part of us showing to the government, for example, in Peru, who we buy from, they're a registered company, and all the way leading to when we sell our gold bars or silver bars to a refinery in Switzerland. That's also part of the condition of responsible gold being sold. Again, like we were saying, we're experts in milling.
So up and above the procurement model, we then have a complete, call it supply chain of processing, which means that from the day we buy a certain lot that is certified, we have our own laboratory, we then process, leading all the way to having a gold or silver bar that we then export. Again, what does it mean, ASM or artisanal minings around the world? Again, ASM stands for artisanal small scale.
If you look at the World Gold Council, call it numbers, which are presented in front of you today, just for gold alone today, according to their statistics, miners specifically addressing gold artisanal mining is over 20 million individuals today. I think what's even more telling is over the years now, the industry has come as such that the production of artisanal mining, which I'll show the next slide, represents over 20% of the annual registered gold production.
I'll just show it the next slide. Again, it's just to give you an idea of what it represents from a macro point of view, but I think the next slide is even more telling. If you look at the blue bars, the blue bars actually show the production of what you call the large-scale miners around the world. Although this shows almost 10 years, if you were to go back even 20 years, the production has been very stable by the ASMs over the last two decades. What's very interesting is the growth of artisanal mining contribution to the world's gold production.
Today you can estimate at least 750 tons of gold actually comes from that, and again, it could be even more because we need to understand that artisanal mining around the world is actually mostly informal, well over 80%. Again, it's just to give you an idea that it is a growing business. What's very encouraging for Dynacor within our own business model is that it's now recognized with regards to the World Gold Council, for example, today uses us as an example, as a reference of a successful business model addressing this ecosystem. So is the LBMA now.
All these things is as such that I'm convinced that over the next few decades, few years, you will be hearing a lot more of the contribution coming from the business unit. Again, with regards to just some more, call it comparisons or if not, information relevant to large-scale miners and artisanal miners. Again, if you want this presentation, by the way, it is available on our website because I can see a few of you taking pictures. Again, please feel free to take pictures. Again, it's just to give you another advantage.
Another also advantage from us, from our perspective of a company, because we're not a miner, of course, call it the taxation rate with regards to where we're working in jurisdictions is not as impacted with regards to royalties and what other impacts that a mining company would have in given countries. That's also an advantage for us. Once we speak with government officials, once we actually explain to them who we are, and once they put us in a given sandbox within the mining code, there is an advantage with regards for us from our unique business model.
Our competitive advantage, for example, in Peru, there's well over another 300 to 400 processing plants in that country alone. Some are formal, some are informal, but it gives you an example of how competitive the market has become. What is Dynacor's competitive advantage or the landscape? For us, it's based on principles of purchasing, pricing, and the processing.
When we say purchasing, we have, as you can probably imagine or if I can explain a bit more, really our, call it our revenue stream is based on when we buy the ore, which is based on a given day on the LBMA pricing minus a discount, which is from the toll milling, from the quality of the ore that we receive.
Are there intrusions with regards to that mineral that we buy? Does it have intrusions like copper or whatnot? In other words, what is the possibility to get the highest recovery rate? But all this purchasing model gives us a competitive edge. Then also the pricing, of course, when I say pricing, it's also got to do with us paying that given provider. What does that mean?
Because we have our own lab, that given miner can actually follow the whole process within 4 to 6 hours. We have, call it, the content of his or her lot, and then we're able to give them a pricing based on today's pricing minus the discount. In many cases, we'll pay them within 24 to 72 hours through electronic transfer, which again is a big advantage for them because it's consistent.
Over the years, if we've been able to garner or keep our loyal providers, it's based on that consistency, trustworthy, and paying quickly and efficiently. Again, if you look at based on the 2025 year from a Dynacor perspective, it's been a record year. 2026, of course, as you can probably see, you've seen the results of the first two quarters. Third-quarter results will be appearing by middle of November.
But you can see that the company has successfully delivered good results over the years. Obviously, this year is a bit more challenging, if I can put it that way. Why is it a bit more challenging? I think it's important for everybody to know that this year, the biggest factor, if I can put it that way, is call it the up and down swings of price of gold, which not necessarily was seen in the last 15 years. For those who do follow the, call it the gold pricing. But again, still we are. Are we happy with our results? It's never enough, don't get me wrong.
We always want to get better, but we are working at adapting with regards to the fluctuations that are affecting us. When you look at 2026, as was mentioned earlier in January this year, with regards to our guides, our guidelines with regards to whether it is gold production, whether it is our sales, the net income. Again, the third-quarter results will be announced in the next few weeks. Right now, we feel good as to where we are, and again, we will be better able to explain with regards to our results.
Again, when we are looking at the gold price and inventory drive with regards to our results, as you can imagine, inventory, of course, is one of our key elements. We are working capital. For us, we do have our own, call it internal goals and objectives on how we are able to manage the inventory on hand, when do we procure, and so on and so forth.
In some instances, of course, these are things that we need to evaluate on a daily basis. Why? Because, of course, inventory, if you have too much, then you are, of course, impacted on the possibility of price variation. It is a mixture of all these blends which makes us successful or in some quarters, making it a bit more challenging.
Optimize, again, what we are looking forward to doing when we say optimize our core operations, like we were saying, this year is a very special year for the company because we are actually expanding into two new jurisdictions, being Ecuador, which is a result of an acquisition of an existing plant in July 2025, which by the way, will be up and running by the end of this quarter. And Senegal, which is actually a pilot plant, which a new entry for us in the African continent.
Why do we call it a pilot plant? Really, it is one, it is to understand the market conditions in Western Africa, which are a bit different to Peru or in Ecuador, for example. It is also the first of its kind in that territory. When you put all this together, we just want to get as much history as we can over the next six to nine months to really look at the next steps of leading to a phase II or phase III of a given more commercial plan. We are getting a lot of support again from the different stakeholders, which is very encouraging going forward.
In Africa, like I was saying earlier, we are the first ones to come in with this type of model. Again, like we were saying with regards to diversity in given regions, as I was showing in earlier slides with regards to where are the important regions of the world that have artisanal mining, it is pretty much in three regions around the world. African continent being the biggest one, contributor, followed by South America, using Peru as a central point, and some parts of Southeast Asia, like the Philippines or Indonesia.
Again, just giving you a few, call it statistics, of what the potential of artisanal mining contributions. For example, in Senegal, they estimate between six to eight tons, more on the eight tons, if not a bit more, of possible production. For an example, in Peru, we produce year in, year out four tons.
Senegal already has a good potential. If you move on to other countries where we're also, for example, we also have a registered company in Ivory Coast. Ivory Coast is over 45 tons. Ghana, by far the biggest country contributor in Africa with over 100 tons today. Actually, the numbers are increasing every year because of the formalization process that the government is trying to get information. Of course, Peru, as you can see, and Ecuador are also a big contributor.
You've also got neighboring countries in South America, like Bolivia, like Colombia, and also Argentina, which also have their own, call it artisanal mining space. Galam, to give you a bit of an overview, Galam is our Senegalese operation, showing you a picture of our plant that's been up and running now for about four weeks. Again, a pilot plant.
We actually had our official inauguration two weeks ago. So it's our second plant. Again, we did have our first pour which to be upfront with you, it was a mixture of gold and silver, which is often the case, what you call a doré. But we anticipate, of course, more production going forward. The pilot plant is going to represent this contribution, of course, it will be, I'm not going to say insignificant, but if you compare a 50-ton plant per day to a 500-ton per day with high grades in Peru, the history will tell us.
But we feel good about the geology of what we know and then moving forward with building relationships with artisanal miners. Again, the ramping up leading to 50 tons per day is taking, of course, the normal time because, again, repeating myself, we're looking at creating relationships with those artisanal miners, if not those artisanal communities, which is common in Africa, by the way. Again, we have a 50-hectare plant that also takes into consideration if we go to phase II.
If it does go to phase II, we're looking at about a 300-ton per day plant, which a decision will be taken sometime in the second semester next year. Again, the plant is also a blueprint of our expansion in Africa. We're using Merrill-Crowe technology which is very efficient with regards to, call it any plant below 500 tons per day. Svetlana, or in other words, our Ecuador plant, is a plant that we acquired, like we were saying earlier, in July 2025.
The plant was actually built in 2012 as part of a mining concession. We only bought the plant, by the way, with over 50 hectares of land, again, to make sure and access the tailings ponds and whatnot, and even future projects with regards to the plant itself. This plant, by the way, has a total capacity of 1,500 tons, which is three times what we have in Peru.
Now, the plan going forward, first is only use half, leading to us being able to occupy the 750 tons capacity. But our guides is we're looking at a realistic growth plan leading up to 500 tons per day by mid-2028. That is our goal from a company perspective, which we feel that by mid-2028, we'll actually have doubled, call it our capacity to a mill, which is 1,000 tons per day.
By the way, the plant is well on its way to be ready for a December kickoff. With regards to, obviously, as you can imagine, this year has been a heavy CapEx, call it relevant with regards to our investments. We are talking close to $35 million spent this year on CapEx with regards to our different operations. Again, whether it is Senegal, Ecuador, and a few important investments in Peru.
If you look at the timeline, like I was saying earlier, for us, if you look at the production overview, we are looking to double by mid-2028, and then we are also looking at other, call it specific milestones to be reached up until 2030. Again, Ecuador. Ecuador, I think it is important for everybody to note that in Ecuador for many years, if not many decades, the country was actually relying more on oil and gas without actually really putting any interest. I would not say interest, but actually putting any, call it priority on mining.
That is changing very quickly now. To give you an example, just in Ecuador this year, six new major mines will be opening up in the country. So it does show the potential of Ecuador. For some of you that may have a bit of geology background, if you look at the Andes or the mountain range, there is a very similar geological formation that goes from Northern South America all the way to Chile. Again, we feel very good on that based on also some of the readings that we have done over the years leading to our investments.
Of course, for us, it is always about creating shareholder value, which is very important to us. Again, to give you a bit of the capital markets profile. Excuse me. From a perspective of a company, we have a solid base, solid foundation. The company have about 42 million shares. We are looking at about a share price as of yesterday at $5.11, market cap of about $220 million.
So we see a lot of upside with regards to our company going forward. Again, this unique business niche that is artisanal mining and the processing thereof, potential is huge going forward. Now, I think it is more about different governments structuring that type of industry, which as you can imagine, we still have a few more steps to do in several countries.
That is also part of our responsibility, by the way, whether we are in Peru, Ecuador, or Senegal, we have a very direct relationship with government entities so that we can explain the benefits. We also have another saying, every miner that formalizes, artisanal miner that formalizes, that gives us their trust, is one less miner using mercury, which I think for the ecosystem is phenomenal, right? Again, with regards to some of the catalysts upcoming, like we say, quarterly updates.
Obviously our Senegalese first gold pour that was done earlier. Going forward in the second half, again, taking into consideration again, the Senegalese operations, again, quarterly financials, the listing on the OTCQX, the Ecuador's first ore feed that will be happening before end of the year, and of course, delivering on our production and financial guidance. That is it pretty much for my presentation. Any questions? Yes, sir.
I am curious, how do you protect against theft?
Theft. It is a good question. Obviously for us, theft, if it was to happen, obviously it is either from inventory we have on hand, which is raw, or whenever we have a pour, which is from the time it is collected from the security agency leading to the export. I can say up until now, touch wood, we haven't had any issues with that. To give you an example, whenever we do a gold pour, it is never announced.
When it is not shared, it is not announced, and it is on any given day or any given time. Whenever we are ready to do a gold pour, whoever needs to be aware is aware, and it is done very quickly. The gold doesn't stay in our vault, for example, in Peru, any more than a few hours. The whole logistics is organized ahead of time. Very few people know, and it is put on an airplane in Lima as quickly as possible. Apart from that, I can't really see who would be interested in stealing our raw material, if they don't know how to process. Yes, sir.
Are you selling concentrate or doré?
No, a doré.
Doré.
Yeah. If I may, that's also one of the big advantages, if I can put it that way, because other processing plants, whether it's in Peru or now we're entering Ecuador, not even Senegal, but in Ecuador, for example, where we bought the plant, it's called the Portovelo-Zaruma area, there's another 80 plants within 50 kilometers, but they only offer toll milling. So in other words, they're only offering a concentrate. So you can imagine that the miner pays for toll milling, gets a concentrate, and then you can imagine who he or she has to sell to, which will take time.
Hi, thanks. I actually find this to be a tremendous story. You're going from 500 tons per day to effectively doubling plus in, I think two years.
Yep
a little bit. So maybe I'd like to push on the risks a bit.
Sure.
So you're ramping up Ecuador. It took you a long time to get Peru to where you wanted to.
Yep.
Are you at a stage right now where you've spoken to suppliers, you feel comfortable that you're finding the right suppliers, you're building the inventory, or are you there yet? How long does it take for you to get comfortable that, hey, you know what? You feel comfortable with the 300 ton production target?
Very good question. Thank you, Michael. I think, yeah, obviously Ecuador is a new market for us. Even prior to making the acquisition, obviously we did some of our studies, right? Or call it our criteria. I can tell you that one of several things. One is right from the get-go that we acquired the plant, we already set up a, what they call an acopio procurement team.
The procurement team, in our definition, is based on three specialties. Procurement, call it specialists, a geologist, and a mining engineer, so that we can, for one, if we do get the chance to meet an artisanal miner, be it whatever the size it is geologically, is the concession really what they tell us that it is? Then we do assaying analysis, and then the mining engineer also, the individual also help them optimize that given property.
Now, what we're also doing a bit differently in Ecuador is we're also collaborating with government entities which already have access to a bank of artisanal miners, whether it's the Central Bank of Ecuador, whether it's planetGOLD, for example, which is very strong in Ecuador. I think the past year has given us a bank of existing artisanal miners. Of course, we have to keep them being patient until we are up and running, which is this quarter.
But we feel very good and we're also being very realistic regarding to the ramping up of our production facilities. For example, in December, when we do start up, we're going to start in a very, I would say, humble production ramping up that will lead to 500 tons per day by mid-2028.
We have one.
Sure.
Do you have any seasonalities, like highest season or lowest season when-
Yeah, it's a good question. I would say obviously in South America, for example, you have what you call the rain season, which is normally typically from December to April. Obviously, as you can imagine now with the climatic changes, now everything is pretty much haywire, right? I think for us, obviously, we need to face that. For example, this year people are talking about the El Niño effect, right?
Obviously we're taking that into consideration. I think also we have to- historically, for example, I'll give you Peru as an example. Historically, in Peru, most artisanal miners are actually agriculturers by trade. What they do is during the, call it the harvest season, which is normally between, call it December till March, you'll get less production, right?
Which is no longer the case, but still, what we try to do is we try to always plan according to the rain season, the mining season. But now because of the price of gold has incremented so much, it is now year-round in terms of, call it, us getting intake of good quality ore. But yes, definitely, there is a lot of factors that are being considered.
For example, even in Peru, it might not even be the weather. It could be, for example last year, for example, we had to stop production. I would not say stop production. We reduced production by almost two weeks because there was huge manifestations on the highways. So there is a lot of things you have to consider with regards to your planning process, but that is also a key element.
Did you have a high season already this year, or it is only
I would not say. No, I think now it is pretty consistent, and I think the consistency shows in our production. If you look at quarter by quarter now, I would say the last 5 quarters we have been very consistent in our production or tonnage done. For example, in Peru, our production capacity is about 500 tons per day. If you look at the numbers on our results, it has been very consistent since the third quarter 2025. Sorry. But a very good question because obviously in the past it used to be a bigger factor to contend with.
Great. I think that is our time.
Thank you. Really appreciate your time. If you've got any questions, please, we're at table 20. Even if you want, we have our colleague, Ruth, our investors relations. Any questions you may have, we'll be more than happy to answer them. Thank you very much for the time.