Good day, everyone, welcome to SSR Mining's first quarter 2021 conference call. This call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to Wes Sconce with SSR Mining.
Thank you, operator. Good day, ladies and gentlemen. Welcome to SSR Mining's first quarter 2021 conference call, during which we'll provide an update on our business and a review of our financial performance. Our financial statements and management's discussion and analysis have been filed on SEDAR, EDGAR, the ASX, and are also available on our website. To accompany our call, there's an online webcast, and you will find the information to access the webcast in our news release relating to this call. Please note that all figures discussed during this call are in U.S. dollars unless otherwise indicated. All references to cash costs and all-in sustaining costs are per payable ounce of metal sold. We will be making forward-looking statements today, so please read the disclosures in the relevant documents. Joining us on the call today are Rod Antal, President and CEO, Alison White, CFO, and Stewart Beckman, COO.
Now I'd like to turn the call over to Rod for opening remarks. Rod?
Thanks, Wes. Good afternoon and good morning to you all. Before we begin, I would like to welcome Alison White, our new CFO, to her first earnings call with SSR Mining. We are elated to have a person with Alison's caliber join SSR as we continue to set the foundation for the future. In time, as travel allows, a number of you will meet Alison in person. For today, you will have the opportunity to hear from Alison as she walks you through the results of a very strong first quarter. Now moving on to the quarterly review. The quality and operational consistency of our four operating sites were clearly on display in the quarter as we delivered production of 196,000 GEO s at an all-in sustaining cost of $1,004 per ounce.
We generated $77 million of unlevered free cash flow. This great start to the year firmly puts us on track to achieve our full-year guidance targets. Our peer-leading free cash flow generation and strong balance sheet have allowed us to take the last step to our overall approach to capital management and allocation. We already implemented a base dividend of $44 million per year to be paid quarterly. Now, in addition to the base dividend, we announced a meaningful share buyback program of up to $150 million. The combination of the base dividend and our share buyback program aligns our peer-leading free cash flow yield with our capital returns yield. Our total capital return to shareholders will be up to $194 million this year, which is a peer-leading position.
It is important to highlight that we have entered into an automatic share purchase agreement with a Canadian broker and have full intention to execute on our share buyback programs, especially at the current share prices. In a short period of time since closing of the merger, we have implemented a holistic capital allocation program that allows us to continue to invest in growth and maintain returns to our shareholders through the gold price cycles, which is great progress and provides clarity on our capital management going forward. From a growth perspective, we continue to invest in valuating capital projects while advancing our large organic exploration portfolio. The purpose of our exploration program is to daylight our ability to sustain 700,000 oz to 800,000 oz of gold production for at least the next 10 years. Moving on to the next slide, which is on ESG.
We've done a tremendous amount of work on setting and resetting priorities of both legacy companies, as well as finalizing a new suite of sustainability policies to align to leading industry practices. This work formed the foundations for our 2020 sustainability report that was released during the quarter. The sustainability report reconfirmed our commitment to communities and the environment, and it also highlighted several achievements during 2020, and most importantly, set out our priorities for 2021. This included a commitment to establishing an action plan to achieve net zero greenhouse gas emissions by 2050. We have also begun to improve disclosures on climate and water management by responding to the Carbon Disclosure Project and aligning our reporting with the requirements of the Taskf orce on Climate-Related Financial Disclosures. From a safety perspective, although COVID remains pervasive, we are doing a good job of managing it at all our sites.
Our COVID protocols focus first on protecting our people, contractors in the community in which we work, and our efforts have been successful in mitigating the impacts to our operations. We have a well-resourced and experienced HS&E and operations team within SSR and are proud of our achievements and vision for the future as we continue to be progressive in our approach. Moving on to the next slide. Our year-to-date production and cost performance is tracking well to meet our 2021 guidance that you can see here on this slide. Our focus for the year is to ensure safe production, and we have several initiatives underway as we push to improve our overall approach to safety and results. The quarter one safety results were a step in the right direction. We're investing in several high growth returns across growth opportunities across the business.
Some examples of the growth initiatives include at Çöpler, the flotation circuit construction and ramp-up, which is on track for commissioning in the second half. We have an ongoing and continuous improvement initiatives at Marigold. At Seabee, we're focused on increasing the underground development rates to allow us to utilize the latent mill capacity in the future. Finally, at Puna, the transition to an owner-operated haulage fleet is underway. All the initiatives that I just mentioned are now progressing to plan. On the exploration side, we're investing $65 million across our portfolio and expect these efforts will take center stage as we advance the exploration targets and provide some clarity on their scale and timelines during the year.
A good example is the step-out and infill drilling at Ardich, which continues to support resource expansion and conversion to reserves for this sizable, low capital intensity asset that is planned to come into production by 2023. Stu will touch on a number of these later in the call. Just moving to the next slide, and before I hand the call over to Alison and Stu, I want to touch base on a few of the quarterly highlights. As I said, operationally, all four sites had a good first quarter, nicely setting us up for the remainder of the year. Our gold production and costs provide a solid start. At Marigold, we set a record material movement, and at Çöpler, Seabee, and Puna all contributed to the strong results.
From a financial perspective, we reported an EPS at $0.47 per share and generated $77 million in free cash flow, adding to our strong balance sheet. Finally, we published the updated mineral resources and reserves during the quarter. Gold mineral reserves increased 5% to 8 Moz , while M&I mineral resources increased 14% to 15 Moz . With that, I'll turn the call over to Alison, who will discuss our financial performance in more detail, starting on slide seven.
Thanks, Rod. Good afternoon, everyone. I'm thrilled to be here at SSR Mining and very excited to talk about the quarterly results as shown on slide seven. We've completed a strong quarter with the assets all delivering on quality and consistency, producing 196,094 GEO s during the quarter and selling 201,494 GEO s for a total of $366.5 million in revenue for the quarter. Attributable net income was $53 million or $0.24 per share, and adjusted attributable net income was $102.4 million for the quarter, with adjusted attributable earnings per share of $0.47. Operating cash flows were strong at $145.2 million for the quarter, and our free cash flow was $77 million before paying out $49.1 million in shareholder and non-controlling interest dividends, as well as $17.5 million to reduce debt.
On the right side of the slide, there are more details on the $0.47 in adjusted earnings per share. Walking from the $0.24 in attributable net income per share to add $0.11 for the amortization of the fair value as a result of the adjustment to bump up to the fair value of inventory and mineral properties at Çöpler at the time of acquisition, followed by $0.03 per share for COVID and integration costs, less $0.03 for taxes, and adding back $0.11 per share as a result of the foreign currency revaluation on the deferred tax assets held in Turkey. Turning to slide eight, we can talk about SSR's balance sheet strength. SSR continues to provide balance sheet strength amongst its peers and maintain strong liquidity, closing the quarter with over $900 million in consolidated cash and $476 million in net cash.
Given heavier loads on working capital in Q1, especially at Seabee, where they restocked while the ice road was still formed, dividend payments to our shareholders of $11 million and a $38 million payment to our non-controlling interest partner at Çöpler, we are in an outstanding cash position. Net cash to EBITDA ratio is 0.6x , again, demonstrating our strength and placing us in the top quartile of our peer group. SSR continues to act on its multifaceted capital allocation strategy, declaring a $0.05 dividend per share again during Q1, coupled with a recently announced normal course issuer bid share buyback program, set up to repurchase 10 million shares through an automated purchase framework within 12 months. On slide nine, we can talk more about SSR's peer-leading free cash flow and capital returns. We are confident that our capital allocation program provides attractive yields for our shareholders.
SSR Mining's peer-leading free cash flow yield of 11% is more than double the mid-cap peer group at 2%. SSR's capital return yield is more than double that of the mid-cap peer group at 5.4% for this year alone. Our capital allocation priorities include investing in growth, returning cash to shareholders, and maintaining balance sheet strength. SSR is accomplishing this through a $0.05 base dividend per quarter, yielding 1% per year, which is supplemented by the share buyback program recently announced and discussed on the previous slide. The combination of a peer group leading return and significant free cash flow generation differentiates SSR Mining and demonstrates our commitment to shareholder returns. We will continue to execute on our priorities, both financially and operationally, as we move through 2021. Stu will walk you through the operational highlights starting on page 10.
Thank you, Alison. Thank you, Rod. First off, for ESG, we had an impressive health and safety quarter with a 65% reduction in recordable injury rate compared to 2020, with all of the sites seeing improvement. We also completed the sustainability report, which I hope you've had time to read. It includes new commitments on greenhouse gas emissions and water. To match this resolve to deliver these extended ESG commitments, we started some restructuring of the EHS&S team. The rollout of our new integrated ESG management system progressed to plan and will provide our business leaders with better tools for delivery, risk management, and improved oversight and data analytics. While COVID remains a challenge for the world, it is now part of our ecology, and we're diligently managing it along with the other risks and business factors. Moving on to operations and growth.
The business is off to a really solid start, with all operations achieving above-budgeted production and overall below-budgeted costs. We're in a great position to deliver guidance for 2021. Some cost savings are simply of timing of exploration and capital spend, which are both expected to catch up. However, taking timing into consideration, overall costs were still slightly better than budgeted for the quarter. Across the business, we've been reviewing and improving our life of mine planning processes. The outcome of this long cycle will form the basis of the long-term guidance, which we will include for the first time with the annual guidance starting in 2022. Moving on to Çöpler. The Çöpler Sulphide Plant continued to process well above design throughput rates. Rates were good relative to budget and offset lower than planned recoveries.
The Çöpler Oxide plant stacked well above budget recoverable ounces under the heap leach, with the gap in production simply a function of timing of the leach cycle. The flotation plant construction is well advanced and remains on schedule with commissioning and ramp up for the beginning of Q3. The flotation plant is really going to transform the Çöpler pressure oxidation plant. Drilling and study work continued in the district, which includes Çöpler, Ardich, C2, and the Çöpler Saddle, and we drilled about 13,000 m of diamond holes in the quarter. We currently have seven drills in at Ardich. The deeper drilling in C2 is showing gaps in continuity of economic mineralization, and late in the quarter, we slowed the drilling. That said, there is already considerable copper-driven mineral value within and immediately adjacent to the reserve resource shells, and the current mine plan does not exploit these.
The study team are analyzing options to leverage additional value from this. Ardich will be the significant feature of the updated CDMP21 technical report, which we aim to complete by Q1 next year. In the last technical report, CDMP20, Ardich was included only as a resource and as a PEA case in Section 24, which showed a potential to add about $500 million in NPV and about 1 Moz of copper production. In CDMP21, Ardich will be improved with the subsequent work and will be converted into reserve. That is, it will move to the base central case and evaluation models. Additionally, and I stress, of course, depending on the outcome of the work, we are aiming to include copper mineralization as a resource and as a PEA case in the CDMP21 technical report. Now let's move to Marigold.
Marigold achieved a quarterly record for mined tons and its second-best quarter of gold production. This is doubly impressive given the site concluded a scheduled 35-day shutdown for the big electrical P&H 4100 shovel. The two new hydraulic PC 7000 shovels stepped up and filled the gap during the shutdown. In the mine, we started drilling and equipping the dewatering bores and commenced the construction of the rapid infiltration basin. This is where the water will be put back into the water table. We also intentionally left some ore in the pit during the quarter while we completed construction of cell 24. The cell is now complete, and we are stacking on it. Exploration at Marigold focused mostly around the existing pits, and we drilled about 25,000 m with what is looking like good results. Please move to Seabee. Seabee's production was slightly above budget.
The annual ice road restocking is done. We are set for the year. There were some new and additional underground mining equipment arrive on site, which will go into service in the coming months. Mine development is also in line with budget. We've been very busy with exploration at Seabee, drilling out the Gap Hanging wall and the Santoy Hanging wall, looking to pull these into reserve and resource in the near term. We're also drilling at exploration sites at Mac North, Joker, and Fisher. We're setting up for more work at Amisk. We remain pretty bullish on the growth potential at both Seabee and Amisk. Please move to Puna. Puna's massive production targets are out of the park. They were well over budget on construction. Unit costs were significantly below budget. Plant throughput was sustained at greater than 4,500 tons a day, a new record.
The longer wait to change over to owner haulage for the mine to the plant started in April and should further lower operating costs. We are reviewing the life of mine planning at a higher processing rate for Puna. Moving to the exploration slide. I've pretty much talked about all these key items already. In summary, for the business, safety was excellent, production was above budget, cost was below budget, and our organic growth projects advanced. A good quarter for the business and our operations and great teams. Thank you very much. Back to you, Rod.
Thanks, Stu, and thank you, Alison. Just to summarize, as I've all mentioned, a very strong quarter to start the year, both financially and operationally. With the now completed capital allocation framework and continuing strong free cash flow, our capital returns to shareholders is peer leading while allowing us to grow. With the operations delivering low capital intensity growth, the balance sheet in terrific shape, and now our capital returns in place, we believe we will regain share price momentum and offer an excellent long-term investment choice for shareholders. With that, operator, I'll pass the call over to any questions you may have.
Thank you. 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 are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. We will pause for a moment as callers join the queue. The first question comes from Tyler Langton with JP Morgan. Please go ahead.
Yeah, good afternoon. Thanks for taking my questions. I guess to start, are you seeing any sort of inflationary pressures for materials, energy, labor? Then I guess just somewhat related with exchange rates, I guess any details on maybe impact on cost, just in Canada, Turkey, or Argentina?
Tyler, I'm going to pass that one over to Alison.
Hey, Tyler. I'll take the first portion of your question off the bat about inflation pressures. At this point, we really have not seen any material inflation pressures across the business. We are continuing to monitor that and stay close to the markets to try to display anything that could be coming our way. We have not yet seen that come through.
Then on the second part of your question, Tyler, around exchange rates and the devaluation in some of the currencies in the countries where we operate. Again, it's usually a short-lived win for us. We normally get offset by the country inflation rates increasing with the devaluation. So yeah, while it's a short win lived and it looks good on paper, it usually catches us up to being sort of net neutral.
Okay. No, that's helpful. Just about the Çöpler, I guess, obviously it was a good start to the year. Just the annualized Q1 production, which gets us below end of the guidance. Production should be sort of ramping throughout the year and costs sort of came in around the midpoint of annual guidance. Maybe can you just talk about the cadence of production for the remainder of the year and just how to think about cost as well, especially as the flotation starts up?
Hi, Tyler. It's Stewart. You remember when we gave guidance at the beginning of the year, we said that we expected Çöpler to be back-end loaded. When we issued the technical report, one of the main drivers in the technical report was the construction of the flotation plant, which drives volumes up at Çöpler through the sulfide plant and significantly pushes the cost down. Our expectation has always been that the year would be back-end loaded, and the cost would drop in the second half.
Gotcha. Great. Thanks so much.
Thanks, Tyler.
The next question comes from Cosmos Chiu with CIBC. Please go ahead.
Great. Thanks, Rod and Stewart, and welcome, Alison. Certainly a great way to kick off your journey with SSR Mining with a huge earnings beat. Maybe first off, my question is on Marigold. I think in the MD&A you mentioned that the heaps are getting fairly high now, and so part of the Q1 production was actually a result of stacking in Q4. In that, can I ask you about the leach cycle these days at Marigold? What's the height of some of these lifts here? I guess the point of my question is, you stacked 5.7 million tons in Q1, fairly good grade, 0.4 gram per ton. When is that going to come through?
It's always an interesting question, Cosmos. For the rest of this year, we'll be stacking in cell 24, which I mentioned we just started stacking on, and we'll start irrigating on soon. For the remainder of the year, we're going to see us stacking pretty close to the plastic, and so we'll see a pretty quick return, or a short leach cycle. We'll actually see a drawdown in inventory from the rest of the heaps.
Mm-hmm. Great. Maybe moving to Seabee here. As you mentioned, 8.45 gram per ton head grade in Q1. Lower than last year, as expected as you were working through some of the lower productivity areas. Stu, could you remind us when are you getting back to some of the higher productivity areas, potentially higher grades?
Yeah. We are seeing some higher grades coming through the mine at the moment. You'll remember the guidance for Seabee was a little bit lower this year than the previous years on the basis of that's what the mine schedule was doing. With an expectation it'll come back up in the following years. We will, as I said in my call, be issuing long-term guidance that will help you to map that out at least over the three years when we issue the long-term guidance at the end of the year.
Mm-hmm. Great. I guess, bringing this all together, as you mentioned earlier, Çöpler is going to be back-end loaded. It sounds like Marigold, in the second half, production is going to be fairly good as well. And Seabee, you're seeing some of the higher grades. I guess what I'm trying to get to is if I look at Q1 production, 196,000 GEOs. If I were to analyze that and you might say I can't, you would hit the top end of full year guidance. How should we look at it? I know it's still early days, but is that possible?
Cosmos, this is Alison. Thanks for the question.
Hi, Alison.
Hi, thank you for the welcome earlier. I appreciate that. I think that our guidance for the year remains consistent with what we've previously talked about. We are going to continue to monitor if there's any intra-quarter changes. Right now, we are affirming what we've previously said. We'll bring back any additional information that we have when we are aware of it.
Sure. Thanks, Alison. Maybe one last question. Just looking at Turkey here. I think, two days ago or several days ago, the government announced a shutdown given COVID-19. Maybe a question for Rod. Could you make some comments in terms of COVID-19 and Turkey and that shutdown? Does it have any impact on mining operations?
No, it doesn't, Cos. It's similar to what we've seen all through COVID, actually, in Turkey. There's been times where there's been restrictions placed. It hasn't entirely brought the country on a shutdown, so, the mining industry is sort of considered in the essential service group. We can continue to operate as long as it's done safely. The restrictions are really around just the public and restricting hours out of their homes and that sort of stuff. They went through, more recently, quite a big spike in COVID cases, and it's really just in response to that in short term, and particularly the fact that they're just about to start celebrating their religious holidays as well, where it's a lot more people, usually mobile, moving around. They're trying to avoid another big spike.
Of course. Got it. Those are all the questions I have. Thanks again, Rod and team, and congrats again.
Yeah. Thanks, Cos.
Once again, if you have a question, please press star then one. The next question comes from Mike Parkin with National Bank. Please go ahead.
Hi, guys. Thanks for taking my questions. Congrats on the solid quarter. Most of my questions have been answered. Just one, on the exploration side of things. When could we expect the next exploration update coming out of Marigold and just in terms of drilling the Trenton Canyon oxides, how are you on that program? Is that program well established and ramping up, or are you still kind of mobilizing drills and stuff? Should we expect a greater number of holes coming in the second half versus the first half in terms of updates?
We are ramping up in that area. We will bring out, over the next couple of quarters, an update of Trenton Canyon, and we will bring out updates of each of the more advanced exploration sites, from Seabee and from Çöpler, to provide updates of where we are across all of the businesses. In Trenton Canyon, we took a step back and are doing more drilling before we advance into study work at Trenton Canyon to make sure we fully understand that resource before we proceed to the next step. We are out there drilling.
Okay, great. Then with Pitarrilla, when do you think you'd be in a position to start drilling from the underground?
After the merger, we took the opportunity, and we put the advancement of the underground decline on halt while we do a more wholesome assessment of the current resource, the current resource knowledge, and the status of that study. We don't have an immediate plan to start drilling in Pitarrilla underground.
Okay. All right. That's it for me, guys. Thanks so much.
All right. Thanks, Mike.
This concludes the question- and- answer session. I would like to turn the conference back over to Rod Antal for any closing remarks.
Great. Thanks, Anastasia. Again, thank you all for joining us today. Really solid quarter and it's obviously nice to introduce Alison that way to the company and hopefully have many more of them to come. Thanks again, and have a great day.
This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.