Earnings Call: Q3 2026

Nov 5, 2026

Summary

$377 million in Q3 free cash flow funded returns as gold guidance was cut.

Thank you for standing by. This is the conference operator. Welcome to the Pan American Silver Third Quarter 2026 Results Conference Call. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may reach an operator by pressing star then 0. I would now like to turn the conference over to Siren Fisekci, VP Investor Relations. Please go ahead, Ms. Fisekci. Thank you for joining us today for Pan American Silver's conference call and webcast to discuss our third quarter 2026 results. This call includes forward-looking statements and information and references non-GAAP measures. Please see the cautionary statements in our MD&A, Q3 news release, and presentation slides for the period ended September 30, 2026, all of which are available on our website. I'll now turn the call over to Michael Steinmann, Pan American's President and CEO. Good morning, everyone, and thank you for joining our call today. Pan American delivered strong financial results in the quarter, generating $377 million in attributable free cash flow and returning $300 million to shareholders through dividends and share repurchases. Our financial position is very strong, with $1.9 billion in cash and equivalents, including cash at Juanicipio, and $3.4 billion in total available liquidity. Our silver business continues to perform well. Silver segment all-in sustaining costs were $11.21 per ounce for the quarter, below our quarterly outlook range. Year-to-date, silver costs have been better than expected, and production tracks on guidance. We have revised our outlook for gold segment operations based on results achieved to date and expectations for the remainder of the year. Net earnings were $357 million, or $0.86 per share. The result includes a gain on the sale of the Larder exploration property and a mark-to-market gain on our interest in New Pacific Metals. Adjusted earnings were $287 million, or $0.69 per share. Cash flow from operations was $462 million, including our share of cash flow generated at Juanicipio. Over the first nine months of 2026, we have generated $1.2 billion of attributable free cash flow and returned $701 million to shareholders. This included approximately 9.6 million shares repurchased and canceled and $228 million paid in dividends. The reduction in share count has resulted in a higher per-share dividend as we execute on our enhanced shareholder return program. For the third quarter, the board has declared a dividend of $0.185 per common share. Our capital returns are supported by a strong balance sheet and healthy cash flow generation, and we are well-positioned to invest in our operations, advance high-quality growth opportunities, and maintain the enhanced shareholder return framework introduced for 2026. Turning to operations. Attributable silver production was 6.1 million ounces in the third quarter, below our quarterly outlook range. La Colorada, Huaron, and San Vicente provided strong quarterly silver production, while Juanicipio and Cerro Moro were responsible for the slight shortfall. At Juanicipio, higher-than-planned silver grades were realized in the first half of the year, resulting in production outperforming expectations and benefiting from the robust metal price environment over that period. The mine is now sequencing into lower silver grade ores for the second half of the year, but remains on track to achieve its annual production guidance. At Cerro Moro, production reflected mine sequencing into lower silver grade and higher gold grades. Heavier-than-normal rainfall as a result of a strong El Niño affecting South America also affected ore transported from the Naty Condor pit to the processing plant and made the oversaturated ore more difficult to process. Our full-year silver production outlook remains at 25 million-27 million ounces, with production expected at the low end of the range. This is due to unplanned downtime at Huaron in Q4 to repair the primary grinding mill foundation and the higher ratio of gold to silver production at Cerro Moro. The repairs at Huaron are expected to be completed in November. We expect full-year silver segment all-in sustaining costs to come in towards the lower end of the 2026 guidance range of $15.75-$18.25 per silver ounce. Attributable gold production was 168,000 ounces in the third quarter, with production at Timmins impacted by a delay in accessing higher-grade stopes and grade underperformance, while at Shahuindo, recovered ounces have been delayed by increased leach pad inventories. Full-year gold production is now expected to be between 660,000-680,000 ounces, reflecting lower production for the remainder of the year at Jacobina, Shahuindo, and Timmins. Gold segment all-in sustaining costs were $2,281 per ounce in Q3, above our quarterly outlook range. Guidance for full-year gold segment all-in sustaining costs is now $2,000-$2,150 per ounce, reflecting lower-than-expected production, increased development at Jacobina and El Peñón, higher labor and consumable costs, and weather-related impacts associated with El Niño. At Jacobina, we have reduced our full-year production forecast to reflect measures being implemented during Q4 2026 to address deficiencies noted during a technical inspection from the National Mining Agency, mainly related to primary ventilation redundancies and completion of secondary egress in certain areas of the mine. We have modified mine sequencing to allow the remediation work to occur, resulting in lower-than-planned production from affected areas and substitution of lower-grade material for the remainder of 2026. We are evaluating the potential impact on 2027 production. In addition, we continue to manage risk associated with seismicity, as previously reported. These measures require increased pillar size, resulting in decreased mining rates in some higher-grade areas, partially offset by increased production from lower-grade areas in the mine and increased development rates to open new mining zones. Meanwhile, we also continue to advance Jacobina's broader optimization plan. Two new carbon-in-pulp tanks were commissioned during the quarter, and engineering and permitting work is progressing on paste backfill, tailings filtration, and power supply upgrades. We are also evaluating options for a new processing facility to address the constraints of the existing plant. These initiatives are intended to improve operating efficiency, strengthen flexibility, and support the asset's long-term potential. As previously reported, production at El Peñon has been impacted by underperformance in certain high-grade stopes, resulting in lower gold grades. The company is advancing plans for additional infill drilling in areas scheduled for production in 2027, while continuing resource definition drilling and evaluation of additional exploration targets with potential to define high-grade mineralization. At Shahuindo, some production is being deferred due to an accumulation in leach pad inventory. Our outlook also incorporates the potential impact on Shahuindo's operation in the fourth quarter from a heavier-than-normal rainfall related to very strong El Niño weather systems, which has impacted many of our operations over the past month. Turning to growth initiatives, we continue to advance the expansion of our La Colorada mine in Mexico, a significant opportunity for material long-term growth in silver production at Pan American Silver. Work on the 12.4 km 588 decline began in mid-August, following mobilization of the contractor and equipment to site. The 588 decline is making good progress and has completed 168 meters of advance on the ramp and 56 meters of secondary development to the end of October 2026. During the third quarter, we also advanced engineering work and contractor selection for the hoisting and ventilation shafts. We plan to submit this component of the project for board approval very early in 2027. At Timmins, we completed the exploration drift to the Samson deposit from the active Timmins West workings during the quarter, enabling further underground exploration drilling. The exploration drift to the Vogel deposit from the active Bell Creek working is progressing, and surface drilling has started at Gold River. We plan to complete the preliminary economic assessment for the Timmins Camp project in the first half of 2027. The study will help define the potential phased approach to developing adjacent mineral resources, extending mine life, and potentially growing production by leveraging excess plant capacity. We have revised our estimates for project capital to $195 million-$210 million for 2026, down from the previous guidance range of $240 million-$255 million due to timing of spending. In the third quarter, we also completed the sale of our Larder exploration property in Ontario, resulting in Pan American Silver taking approximately 6% ownership stake in Cadillac Mines Corporation. This provides continued exposure to the prospective Larder Lake Cadillac break to our equity interest. At Juanicipio, the transfer conveyor project was completed during the third quarter, with commissioning expected to be completed by year-end. The project will improve efficiencies and reduce the cost of ore haulage to surface. Regarding Escobal in Guatemala, the government has provided an update on progress achieved during 2026 in the ILO 169 consultation process with the Xinka representatives. The process continues, but there is currently no timeline for the conclusion and no date for restart of the operation. To conclude, we are on track to achieve our silver segment outlook for 2026 and expect silver all-in sustaining costs to be at the lower end of our guidance range, and we adjusted our gold guidance and gold all-in sustaining costs. The underlying strength and quality of our portfolio continue to generate substantial free cash flow and create long-term value. We are advancing opportunities at La Colorada and Timmins and pursuing initiatives to improve the performance and flexibility of our existing operations. With a strong financial position, a diversified operating portfolio, and a disciplined approach to capital allocation, we believe Pan American is well-positioned to invest for the future while continuing to return meaningful capital to shareholders. Before we move to the Q&A portion of this call, I would like to take a moment to congratulate the La Colorada exploration team for receiving the Thayer Lindsley Award from PDAC for the discovery of the Skarn deposit. The discovery of La Colorada Skarn is certainly deserving of that award, given it has transformed the future of our La Colorada asset, and we are progressing with our plans to make it one of the world's largest silver and zinc mining operation. With that, I'll turn it over for questions. We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. The first question comes from Matthew Murphy with BMO Capital Markets. Please go ahead. Hi. Could I ask on Jacobina, just to clarify, the regulator comments are unrelated to the seismic issues disclosed last quarter. It's a separate issue. Anything you can provide around 2027, how you think about how long lower grades could persist? Yes. Good morning, Matthew. Scott Campbell here. I can address your question. Brazil's National Mining Agency inspected the mine early in October and noticed some deficiencies related to the primary ventilation redundancies and completion of secondary egress in certain areas of the mine. There are certain aspects of the Brazilian mining code that can be interpreted differently. We have guidelines developed based on our best practices across various jurisdictions where we operate. Nevertheless, we experienced some delays to vertical developments and are expediting our remediation plans in coordination with the mining inspector. Work is expected to continue throughout the remainder of this year, and we are assessing the impact on 2027 production. Your first question, it is no, it is a separate issue. It is not related to the seismic issue that we explained earlier in the year. Yeah. Okay. Thank you. Maybe just one on looking at production trends, and you have Juanicipio moving into lower silver, higher base metal zones. You have Cerro Moro, a little more gold-weighted. Is there anything structural here, or it is just kind of particular to those mine plans where you are getting into more by-products than silver? Yeah. Hey, good morning. It is Michael. Definitely, obviously, these deposits across the globe with their geology have zonation. You see there we are mining actually more gold or gold-richer ore at Cerro Moro than silver. Not a bad by-product to have, obviously. As you know, this is a silver-gold deposit, and depending where you are mining and which part of the veins and the pit that we have, the Naty Condor, you have more gold or more silver at any time. So at the moment, more gold-rich ore that comes into production from there. When you look at Juanicipio, and I think we talked about it several times, it is the same geology, a very similar geology than we see at La Colorada, where you have a clear zonation into more base metals deeper down in the mine. While you still have high-grade areas, and depending how much of the tonnage you mine on higher parts of the structure mixed with lower part of the veins, you have more silver or more base metal-rich ore that you produce. So very similar to La Colorada. You can obviously kind of mitigate that by mining parts higher up in the system in new veins to bring in more silver, and that is what we are working on, and that is exactly the same that we have been doing at La Colorada to maintain those higher grades. But if you go deeper down, obviously you maintain dollar value by mining more base metal or by-products in those kind of deposits. But definitely when you go deeper down in these Mexican silver deposits on any given structure, you are going to higher base metal and less silver grades. Okay. Thanks, Michael. No problem. The next question comes from Wayne Lam with TD. Please go ahead. Oh, hey. Morning, guys. Maybe, I guess, as a follow-up, was just wondering at Peñon, maybe if you could give us a bit more detail on the reconciliation issues with the higher-grade stopes and with the depletion of the stockpiles, kind of how we should think about the processing rates and, I guess, production profile into 2027? Yeah. Really nothing has changed what we disclosed on Peñon in Q2. I think we alluded there that we cut out about, I don't know, how much was it? 10,000 ounces of gold for the year. Those are really some high-grade stopes that didn't have sufficient drilling from the way past in a bit more narrow structure, so there's less continuity than we have expected. We are increased drilling on those structures, but for the meantime, removed some from the reserves and moved them into resources. You would have seen that in our reserve update that came out late in summer. Nothing really has changed there. Obviously, the exploration team is actively drilling those structures, and as soon as we identify more continuity on certain veins, we will move them back into the reserves and into the mine plan. When you look at the stockpiles, in fact, it's very interesting. There are a lot of, I would say, quite a few open-pit opportunities at El Peñon. As you probably recall before, at the very beginning of El Peñon, way back, way before Pan American had it was a combination of open-pit mining and underground high-grade veins. Those stockpiles still are part from that open-pit mining time. Now, fast-forward to today and very elevated metal price, we definitely have a very hard look for additional open-pit material, although low-grade, as we have capacity in the plant. Obviously, that would not displace the high-grade from the veins, and that would be a very welcome addition to our mine plan. That's really what our focus on the exploration side is going on right now. Okay, great. Thanks. I'm not sure if I missed it, but were you able to provide a quantum of the total downtime anticipated at Huaron for the repair of the foundation? Then maybe just more broadly, just on cost pressures, if you could provide a bit more detail on what you're seeing on labor in general, including whether there's been any additional strikes at La Colorada, as well as inflation in Argentina. Thanks. Yeah, sure, Wayne. It's Scott here. I'll answer your question regarding Huaron. The Huaron plant should be fully operational again by the middle of this month. Total downtime would be about 40 days is what we calculated. Just to add that, obviously, the mine is at full production, stockpiling material, and we will have capacity to produce a lot of that ore and push it through the plant when the plant is back up running for the rest of the year and very early next year. So, just a mechanical issue, obviously, that we have to deal with, which was unforeseen. Regarding cost pressures, for sure, I mean, we see cost pressures like everyone, not only in the mining industry, but across the globe with very elevated inflation numbers, largely driven by high energy costs, fuel costs, but not only, but for sure, that pushes up all the costs. As you know, we have only one open pit left, so our fuel consumption direct cost is only about 5% of our total cost. So, that on its own, obviously, would not be a big cost driver for Pan American. But when fuel costs go up, I don't need to explain that in detail because we all see it in our daily lives. When fuel costs go up, everything is getting more expensive, and we see wide increased inflation across the globe, and that's really what we are experiencing. So, it's really that, and then in combination in a very tight labor market. The labor market situation is really depending on location, very tight in some places in Canada, quite tight in some places in Latin America, then others where we have actually access to a lot of really, really highly qualified people for the mining, engineering, geology, et cetera. We obviously take advantage of that, and we're a large company, and we can move people around to different operations to kind of make sure that we have the right labor force in the right place. So, that's an advantage that Pan American has with having operations across the Americas. But definitely tight labor market. I think we have seen over the last few days oil prices coming down. Hopefully, that will continue, and that will have immediately an impact to our cost. But as I always explain on cost, it's not only that direct cost that you see increase in labor cost and fuel and energy prices, but exchange rates have a very big impact to our cost as well. Some of them actually we haven't had a tailwind on that, especially in Brazil after the elections. Others, we have had wind. That can move our cost quite a bit. Lastly, of course, by-product credits, which have a big impact to our costs. And you can see that especially in our silver segment side, where we actually came in with costs substantially under the expectation. And part of that is, of course, driven by higher zinc prices, base metal prices, so higher by-product credits that drive those costs down. Okay, that's great detail. Thanks for taking my questions. The next question comes from Lawson Winder with Bank of America Securities. Please go ahead. Thank you very much, operator, and good morning, Michael and team. Thanks for the update today. Good morning. Could I revisit Jacobina? It is just regarding the deficiencies identified by the National Mining Agency. I mean, I think it is a bit of a surprise, just given it has this history of being an industry leader in safety culture and that. I guess I would acknowledge that it is a relatively new asset in the portfolio, I assume. But I mean, is it possible that there is more work that needs to be done at Jacobina to ensure the Pan American safety culture is more fully adapted there? There is definitely a lot of work ongoing. As you mentioned, this is one of our newest operations that we have, and some work ongoing to bring everything to exactly the levels and the systems that we have installed in every other operation. As Scott Campbell mentioned, we have been a bit behind on some of our vertical development, and that obviously impacted some of the work on the egresses and in part some on the ventilation. But the ventilation, I think, is a bit a different issue there. It is really discussion on redundancies on ventilation and power systems, actually a requirement that, to my knowledge, doesn't really exist in other jurisdictions we are working in. But of course, we are working with the regulators to remediate all that as quickly as we can and, yeah, bring it really full up to the kind of the Pan American way of work. As you imagine, it is a big mine, and it takes a while to get that all done. Obviously, all hands on deck to continue that work that we started a couple years ago when I took over the operation. Okay. Yep, that is helpful. Then in terms of the considerations for 2027 guidance at Jacobina. So the original was 181 to 191 last quarter. You got it to 10. Well, the implication was you got it to 10% below that. Just looking at 2027 and thinking of the moving parts, with the 2026 guide at Jacobina evidently still lower. I mean, is flat now versus the current 2026 level reasonable, or should we be thinking of 2027 as flat versus whatever the Q4 run rate is? Well, it's a little bit early to answer the question, just for the reason that, especially on the ventilation side, to find all the independent power source and ventilators takes a while. But we have been successful sourcing some and get them installed. I don't have really details exactly how long it will take. It will definitely drag into the early part of 2027. But I would refer to our forecast in early January when we have really the final details on that. But there will be definitely an impact at the beginning of the year, but I would expect that everything else later on in the year will be remediated and back on working. Oh, okay. That's helpful. Thank you. We're expecting another exploration update. Should we still expect it later this year, and then would it be sensible to anticipate any sort of resource level update at La Colorada or any of the other assets for that matter? Definitely, there will be an exploration update here pretty soon. As you can imagine, our exploration teams have been incredibly active this year. I think we're looking at over, well, close to 700,000 meters of drilling or 650,000 meters of drilling. Some really exciting results, and we'll obviously share them with you. We just released the reserve and resource update in September, so we're not going to come out with any update on that. Maybe, did you refer just to the Skarn with that or in general, Lawson? Because there will be an update, I think, on the Skarn. Let me just Q1. In Q1, there will be an update on the Skarn, but only the Skarn resource. The rest of our reserve and resources obviously get updated every year, mid-year, and we normally release that in September. Okay. Yeah, that's very helpful. Yeah. If I could just ask one final question, maybe on capital return. It looks like you've done about roughly 58% of free cash flow to equity holders versus the framework, which is a bit I mean, I guess you're targeting up to $1 billion, but I mean, I think originally you had talked about 35%-40%. So 50% is quite material and quite materially different from what you had originally talked about at the beginning of the year. How should we think about that percent of free cash flow return going forward? I mean, can you sustain something in the higher than 58%, approaching 60% range? Look, that obviously came together when you look at our cash flow moves, our share price moves during the year. That return we announced of up to $1 billion, I think was 35% to 40% of our cash flow we announced in May, based on share prices and metal prices at that time and cash flow. Right now, we are a little bit ahead with the spending. I think there has been great opportunities for us to repurchase shares. We can obviously equilibrate that a little bit and adjust a little bit in Q4. But in general, of course, it doesn't really matter how much money you spend on the share buyback, it matters how many shares you are able to buy back. I think when you looked at those prices in May and that the kind of equivalent share count we wanted to buy back at that time was about 11.6 million shares. Of course, with lower metal prices, share prices came down as well. So we don't need to spend $1 billion to buy back those 11.6 million shares, which is obviously our target. Okay. Thank you for that. I appreciate all the answers. Thanks. The next question comes from Cosmos Chiu with CIBC. Please go ahead. Hi. Thanks, Michael and team. Maybe my first question is on Timmins. Good to see that you're putting some money to work at Timmins. I have the PEA, and as you mentioned, there's been exploration at the Samson Deposit, Vogel, and I think you also mentioned Gold River. Would all that be included potentially in the PEA, or we're not too sure yet? As a follow-up, I also saw that Pan American Silver now could end up owning 27.3% on a partially diluted basis on Galleon Gold. Maybe, Michael, could you also touch on how that potentially fits into your Timmins strategy? Yes, Thomas. Let me just answer the first part, and then I hand you over to Ignacio, who has the numbers from Galleon Gold, our investment there. Look, in general, what we're achieving here, and I think we do, is surfacing value and additional value that we see in the Timmins district. It's a very large historic gold district in Canada. We are now there for a number of years. We found all these satellite deposits that have very interesting grade, very interesting location to our current operation. As you saw there, we have access and access the second one right from our current operation, so they're in very close proximity and can add additional production to our profile here. Yes, all these satellites will be included in our updated PEA that's come out in the first six months of next year. And they'll make Timmins a very interesting district. Galleon Gold, how much, Ignacio? Hi, Thomas. This is Ignacio here. It's 15.6%. Hi, Ignacio. Hey, Thomas. It's 15.6%, and on a fully diluted, it is around 27%. Partially diluted. Partially diluted. The idea there really that deposit is right next to Timmins West obviously makes a lot of sense to give a hand there to our neighbors, looking at potential ore quality and contributions. It made a lot of sense for us to make that investment in, again, in a district that is growing and a very interesting production profile in Canada. Great. Then, Michael, maybe more near term, you kind of touched on it, on silver production. 6 million ounces was below your expectations for the quarter, in part due to mine sequencing at Guanaceví and Cerro Moro. Could we potentially expect a bit of catch-up in Q4, or is it really beyond Q4 where the catching up is going to happen? I think with the mill repair at Huaron, will be probably hard to catch up a lot. I think we're probably going to stay more closer to flat while we pretty much guided that we're going to come in at the lower end of our guidance, but within our original guidance range. That should give you pretty much the number where we're going to end up. We try to catch up as much as we can when the mill is back up running at Huaron, but it will definitely drag into Q1 and Q2 to treat and recover all those ounces from the accumulated stockpile that we are accumulating right now. Of course. Maybe one last question, and we talked about a lot of the weather-related issues according to or in relation to El Niño, or they call it the Super El Niño. You kind of factor that into your Q4 guidance. I think you mentioned that anticipating some weather-related issues at Shahuindo in Peru. I guess holistically, taking a step back, Michael, have you seen it? Have you seen the impact so far in terms of El Niño hitting LATAM, or are you still anticipating? Is it still to come? Oh, no. Huge impacts that we've seen during this quarter in some of our operations. In Cerro Moro even, got a lot of rain. Think I alluded to that in the conference call here that roads get difficult to pass, very wet ores, very difficult to push through the crushing circuit, as you can imagine. Huge rainfalls around Antofagasta and El Peñón, an area which is probably one of the most arid place on the planet, that suddenly got in one day, not only a 100-year rain event, but actually the accumulated rain of 100 years. I think it was in one day or half a day. I would refer to listeners to look at some of the YouTube videos. Luckily, nobody got injured in Antofagasta, but huge mudflows coming down through the city. Of course, that has impacted El Peñón. Big rainfalls and storms that we see around Santiago, no surprise there neither. I'm sure people have seen the mudflows that actually went right through downtown Santiago in some places, and we see impacts of that at our operation in La Florida. So definitely, and I'm sure you noticed all the copper producers that have been hugely impacted by those big events as well. So it's definitely a big El Niño, a climate event that we normally have every five to seven years, but definitely not as strong as it is right now. The impact that we accounted for, and we obviously, we are not predicting, trying to predict the weather here, but rainfall or no rainfall in our, on the heap leach operation now, Shahuindo has big impact, and we try to count a little bit in there. Of course, those El Niño events are now moving further from further south up further north, and will normally impact Peru in November and December, maybe this is a bit stronger and will last into January. So we will see how that goes, and what the impact will be. But yeah, definitely large impacts to all our operations. Even San Vicente got, I think, a lot of snowfalls, and while those weather systems move over the Andes and further east. Understood. Thanks, Michael, for answering all my questions. That is all I have. Thank you. Thanks, Cosmos. Once again, if you have a question, please press star, then one. The next question comes from Charles Hiriamin with Jefferies. Please go ahead. Thank you for taking my question. I am asking on behalf of Saad. My first question would be on Escobal. It would suggest that the updates suggest meaningful progress with the Xinka people. Would you be able to clarify what is required from this point to bring the consultation to conclusion and reopen the mine? Yes. As we alluded there in the call, lots of activity, lots of meetings. You can actually check that out and read the updated state of the union, if you want to call it like that, of the consultation process on the government website that we refer to in our materials. That gets normally updated every few months and gives you details what kind of meetings have happened. Those meetings are still continuing, so I do not have really a date or when that consultation comes to a conclusion. It definitely has been a long time, a lot of activity there over the last few quarters, and I would expect that that continues. There is no clear finalization of the dialogue process, I think. As I said, I do not have a date. It has to be, really will be decided at the end by the court, again, when all the material from the consultation goes back to the courts in Guatemala, and they will make a decision that this consultation has been fulfilled, and that will be the time when hopefully we will get the go-ahead to restart the mine. Okay. Thank you. Just maybe a follow-up on that. I know you guys have previously guided about $80 million-$100 million in working capital and about four to six months to restart production. I just wanted to confirm that that is still the case at the moment. I think so. Of course, capital costs are increasing, but the mine is in good shape. We maintain the plant and the underground in good shape. We could restart, I would probably say, in about six months' time, first stope for sure. Stopes at the Escobal are very large stopes. The structure in some parts is up to 45 meters wide, and that will provide meaningful production in that kind of timeframe. Normally, we guided that it will probably take after that about a full year to go back to our full production levels, which in the past, when it was running last time, was around 21 million ounces of production. That is correct. It is obviously a lot of training. We need some underground equipment to be replaced, and the rest will be mostly training and rehiring of the workforce. All right. Thank you very much. That is all I have. Thank you. The next question comes from Don DeMarco with National Bank. Please go ahead. Thank you, operator. Good morning, Michael. Morning. After your reserve and resource update in September, do you have a refreshed list of priority divestment candidates, if any? Or conversely, maybe some mines that have reestablished their position within the portfolio? I think we saw sizable reserve increases at Cerro Moro, San Vicente, and Huaron, some declines on the gold side. Just interested in your thoughts there. Yeah. When you look at the reserve, I mean, that's been very successful, especially on the silver side. Do not forget, large part from our gold or the reduction comes from the reduction at Shahuindo. Obviously, when you mine a given shell on an open pit, you cannot just simply replace the reserve and additions unless you would have a big pushback, which is at the moment not in the cards. Reserve addition would simply come from higher metal prices or lower cost, if that would be the case, and kind of marginal material that would move from resources into Oh, sorry, from waste into production. You should assume that in most of the open pit situation, you would deplete reserves, and that's what we've seen, and that's mostly happened to gold. When you look at our underground operations, as I said, the exploration has been incredibly successful, replacing all of the silver mine, I think even a bit more. As I said, we will put out the press release later on, probably this month, with some of those results, which have been pretty impressive and continue to be very impressive on the exploration side. Then your second question on the portfolio optimization, look, we always work on that. We just sold the Larder deposit. There will be more activity coming. Obviously, I don't want to give you a list here exactly what is ongoing there, because this is all confidential still. There's always a lot of work, as you can imagine, has been in the past. We have sold a lot of assets, and we recovered a lot of cash through those, and we'll continue looking at our portfolio and optimize while we go. Okay. That's helpful. For my second question, back to the quarter. At Timmins, and building on Cosmos' question. On Q3, can you separate the impact of delayed access to the higher-grade stopes from grade underperformance? When should we expect these grades to recover? What would be a reasonable normalized production cost level? Then separate to that is, how much of the cost impact in Q3 was related to labor pressures? Well, I don't know if Ignacio, do you have any details on the labor pressure? Maybe we can send that to Don later on. Yes to go and dig a bit deeper into those cost details. I think across the board, we probably see an 8% kind of increase, but probably a bit different in Canada, so we can provide you with those numbers, Don, for sure. Really, a longer-term project, I think, in Timmins, when you look at the overall, it just approved the shaft extension at Bell Creek last quarter. That's ongoing with the work and brings us deeper into that deposit, which absolutely continues. I mean, all the exploration shows that we have similar kind of structure, similar kind of grade going deeper in the asset, and we just need better access right now. At the moment, the shaft is not deep enough, and we're trucking quite a bit of a distance, which adds to our cost. Once the shaft is in place, obviously, we will see lower transportation costs for that kind of ore. Can you remind me when the shaft will be finalized? Yeah, well, The extension? I have to get back to Don on it. It is about two and a half years. 2029. The LOI has been- Yeah. 2029 completion, Don. That will obviously help in our extraction cost for the ore. But in general, you really have to look at Timmins, I think, in a more holistic way to explain to Cosmos, and that will be very interesting when we put out that PEA and including all those satellites around. I think there's way more to do in Timmins than just Timmins West and Bell Creek. I am really looking forward to share a more holistic Timmins with you, everybody, in the next six months. Okay. Thank you for that, and good luck with the rest of the year. Thank you, Don. This concludes the question-and-answer session. I would like to turn the conference back over to Michael Steinmann for any closing remarks. Please go ahead. Thanks, operator, and thank you, everyone, for calling in. It's still a very, very interesting and strong quarter. Incredible strong cash flow, even though metal prices came off quite a bit. Generated over $377 million of attributable free cash flow during the quarter. Of course, that continues allowing us to provide meaningful returns to shareholders in dividends that actually increased slightly, a dividend now $0.185 per share for this quarter. As we're buying back shares, that fixed dollar amount dividend is increasing every time a little bit, as anticipated, and strong share buybacks. We returned up to now over $700 million this year to shareholders, while we increased our cash and short-term investment holdings to over $1.9 billion, and built, as we just heard, not only in Timmins, but also at La Colorada, and working on the study at Jacobina. Very good position to be in. A lot of value to be created here in the future. A lot of interesting and exciting projects ongoing, and looking forward to give you an update in when it's done in February for the full year already. Until then, enjoy the rest of the year and talk at the beginning of 2027. Thank you, everyone. This brings to a close today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.