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Wed Jul 28, 2004
Second Quarter Results Conference Call
Operator: Good afternoon, ladies and gentlemen, and welcome to the Pan American Silver Corporation second quarter results conference call. At this time all participants have been placed on a listen-only mode and the floor will be open for your questions following today's presentation.
It is now my pleasure to turn the floor over to our host, Mr. Geoff Burns, President and Chief Executive Officer. Sir, the floor is yours.
Geoff Burns: Thank you, operator, and good morning and good afternoon, ladies and gentlemen. Welcome to Pan American Silver's second quarter earnings conference call. Our Chairman, Ross Beaty is unavailable today, so I will do the honors. Joining me today are Andy Pooler, our Senior Vice President of Operations; Steve Busby, Senior Vice President of Projects; Rob Doyle, our Chief Financial Officer; and Brenda Radies, our Vice President of Corporate Relations. They are here to help answer any questions you might have at the end of my opening remarks.
As you've seen from our earnings release this morning, the second quarter was our best ever performance on the numbers front. We were profitable. I'm going to repeat this because for the first time in Pan America's history we have been able to say it: we were profitable. We generated excellent cash flow from our operations, we generated record silver production with a particularly strong showing from our Peruvian mines, and we have made substantial progress on all our development projects.
Let me first make some comments with respect to our production and our financial results. Silver production was up 19%, our average realized silver price was up 36%, and in April and May we shipped almost all the concentrated inventory accumulated up to the end of March. Together, these factors increased our revenues by 67% over the same period in 2003.
Our cash flow from operations increased ten-fold to 2.4 million before changes in working capital reflecting the excellent operating performance in Peru. We also enjoyed a one-time gain from a sale of a non-core property to Barrick Gold for 3.7 million dollars. Offsetting the positive factors was a one-time debt retirement expense of $1.3 million on the conversion of our debentures, which we completed in May; $700,000 in stock compensation-based expense; and $1.1 million in increased exploration and development expenditures; and to be frank, some disappointing results from the La Colorada mine in Mexico.
During the quarter, we repaid all of our bank debt, and as I am sure you recall we converted to equity almost all of our debentures. With less than a million dollars in our debentures outstanding, the company is virtually debt-free with $119 million in cash ready to fund our continuing growth. On that front, we expect to complete the purchase of the Morococha mine in Peru next month and we have been, and will continue to aggressively advance our development projects. With the exception of La Colorada, it was a good news quarter from the operations.
Let's talk about Peru. At Huaron, our largest silver mine with expected production of almost 4.5 million ounces in 2004, our operating performance improved substantially in the second quarter as we expected. We've got the ground conditions stabilized, our equipment availability is improved, as has our productivity, and we expect the mine's performance to continue on this improved level as we have finished replacing the mining contractors with our own employees. We expect a cash cost to average under $3.50/oz for the rest of this year. This change in our operating strategy to our own employees from contractors is a prelude to the anticipated expansion at Huaron. Right now, we are continuing with our feasibility study and drilling to expand that project and that mine in 2005. The drilling program, which we started late last year, has returned some excellent results and we will continue to follow these results with additional drilling in the second half of this year. Our goal: to expand our mineable reserves. It's simple, we need to delineate and convert our resources to mineable reserves, which will allow us to plan our expansion and then maintain the productivity levels and production levels that we can achieve.
Quiruvilca has continued to perform exceptionally well. Cash cost for the quarter were $3.52/oz. We expect the changes that we have made there to continue to give us positive results for the foreseeable future. With some new veins discovered, the Split Sur for example, we now have a definitive two-year mine plan and expect the operation to continue well beyond that timeframe.
On our Silver Stockpiles, we continue to see excellent results. These are also in Peru. Our cost for tons sold declined to 42-cents per ton net of our byproduct credit, zinc, copper and lead, which has increased our margins significantly. I want to remind everyone that our cost per ounce figures for the silver stockpiles are somewhat misleading as the smelter charges are based on a sliding scale royalty that increases with the price of silver. But so far, we remain well below $3 and we are hoping to produce over a million ounces from the silver stockpile this year, at under that $3 figure.
Also in Peru is the Morococha mine, which we are finally in the finishing process of making the acquisition. As often happens with deals that require various levels of approval, this process has not gone as quickly as we had liked, but just last week we launched the public offer for the shares of Argentum. Argentum is the company that holds the Morococha asset. The offer is open for 20 business days and we have a lock-up on 92% of the common shares. So now we are expecting to close this transaction on August 23rd. It is very pleasing to report that Morococha also has been performing very well this year, and that the financial benefits from this performance will pass to us on completion of the acquisition. We expect to see 1.5 million ounces of silver production through our account this year from Morococha and on an annualized basis, we expect to see about 3.5 million ounces of silver at a cash cost of about 3 dollars an ounce. So far this year, to the end of June, Morococha has produced almost 1.7 million ounces of silver at a cost of under $3/oz, and that performance is expected to continue. After the acquisition of Morococha, our total silver production from Peru alone will rise to almost 10 million ounces annually. Morococha's a great asset; the the exploration potential on the land package is excellent. It's going to be low cash cost, and it provides significant synergies with our other operations in Peru: Huaron and Quiruvilca.
Turning now to Mexico. La Colorada has clearly posed our most significant challenge in this quarter. A number of different circumstances has kept La Colorada from performing to its potential and we have been working very, very hard to overcome these difficulties. The bottom line; we will not reach our anticipated production this year. Our expectation is to produce approximately 1.8 million ounces of silver in La Colorada, at a cash cost of about $5.50/oz. There is good news. The good news is that we have a plan in place to bring up production and lower the unit costs and we are now starting to see the operational improvements that we have been planning for. We've seen a dramatic improvement in safety of the mine; so far this quarter we have had no incidents and that has been translating into improved morale, better productivity and better production results overall.
We have completed a new, long-range mine plan and we expect that a change in our mining methods to a more selective, narrow-veined mining method is going to increase our grades and improve the profitability at La Colorada. We won't see it this year, but our expectation is in January of 2005 to start to see the feasibility results that we have been anticipating. De-watering will be a crucial issue for La Colorada and we brought in expertise and have a plan in place to bring the water levels down to allow the suphide production to continue. Probably most importantly, we have a new mine management team in place at the mine and they have to be congratulated on the way they have been able to come to grips with the issues and the challenges and are starting to put the mine back on a solid footing.
In addition to our operations, we've also made excellent progress on our development projects. The Huaron expansion, as I mentioned earlier; Manantial Espejo, our joint venture with Silver Standard in Argentina; Alamo Dorado, our development project also in Mexico; and San Vicente in Bolivia. We are very excited about the results from this year's drill program at Manantial Espejo. As we said in our last conference call, we have encountered some spectacular holes such as 50 meters, grading almost 800 grams per ton silver, and 7 grams per ton gold. This is equal to a 165 feet of 24 ounces per ton of silver and .21 ounces per ton of gold. The resource base continues to grow and with completion of the resource estimates, we are now moving straight into operating and capital cost studies. We expect the first study to be competed at the end of August, which will give us the fundamental economics to move directly and completely into full feasibility studies. We still expect the feasibility to be completed in early 2005.
At Alamo Dorado, we've also continued to progress that project. We have completed a capacity optimization study, which looked at us building a 3,000 ton per day milling operation. Permitting is well under way. Cyanide recovery options are being tested and the processing flow-sheet alternatives are also being optimized. A production decision on Alamo Dorado is still anticipated at the end of December of this year.
At San Vicente, the project is undergoing small-scale mining as we speak. We will expect almost half a million ounces of silver to come to our accounts from San Vicente this year as we continue with the feasibility study. Right now we're preparing an economic evaluation and we are evaluating several different alternative development strategies, which would actually minimize our capital investment in Bolivia and see mining activity there much faster.
That comes to the conclusion of my remarks on our operations and our development projects. And I'd like to spend a couple minutes just to talk about the silver market.
Very recently, we have seen a lot of volatility in the silver price. We have seen some significant gyrations, sometimes as much as 30 cents in a single day. Right now, we are seeing both gold and silver respond to the U.S. dollar. Both the movement in the dollar and the sentiment about future movement in the dollar are being reflected in gold and silver prices. Hedge funds again are significant players in the metal market and they are contributing to this volatility. The fundamentals for silver remain strong. Overall, demand was up 1.6% in 2003, according to Goldfield's Mineral Services who conducts their annual survey. They expect this trend to continue in 2004 and beyond. We believe the silver supply deficit, which was some 92 million ounces last year was again filled up with government sales primarily. We also believe that these stockpiled supplies are nearing depletion, making a continued bullish case for silver, based on the basic supply and demand fundamentals.
So to sum up, we had an excellent quarter. We are in the strongest financial position we have ever been in, and the market fundamentals for silver continue to be strong. We are profitable, debt-free, fully funded for our primary growth projects, and are performing at peak efficiency. With the continuing focus on improvements at La Colorada, we believe we can build on this quarter's achievements and continue to be profitable into the future. Our leverage to silver prices is profound and will increase even more with the closure of the purchase of the Morococha asset and as we continue to deliver on our growth projects.
Thank you, and now I would like to take some time to answer any questions you might have. Operator?
Operator: Thank you. The floor is now open for questions. If you do have a question, please press 'star, one' on your telephone keypad. If at any point your question has been answered you may remove yourself from the queue by pressing the pound key. We do ask that you please pick up your handset to minimize any background noise. Once again, if you do have a question, please press 'star, one' on your telephone keypad. Please hold while we poll for questions. Once again, if you do have a question, please press 'star, one' on your telephone keypad at this time.
Thank you. Our first question is coming from Haytham Hodaly of Salman Partners.
Haytham Hodaly: Hey Geoff, how are ya?
Geoff Burns: Hi, I'm good. Yourself?
Haytham Hodaly: Good. Just a question, I mean, you indicated that this was, you know, your first profitable quarter but looking at excluding the unusual items, and including the loss of the debenture conversion, we actually took an estimated net loss of about 1.1 million, or a loss of 2-cents per share. Now isn't that probably more accurate?
Geoff Burns: Haytham, a couple of comments there. I think there's a couple of other things to take into account as we move forward. The first one is that at Manantial Espejo we have been expensing all our pre-production development costs at this point in time. Our expectation is with the completion -- and that's almost $700,000 during the quarter so that's -- our expectation is that this quarter with a positive result on our scoping study that we will look very hard at that policy and probably will start capitalizing that going forward and the expenditures will, you know, continue to increase during the balance of the year. So that's about $700,000 there. The second thing is within our exploration development expenditures, we also have a very hard look at a property and we spent almost half a million dollars. That was not a successful business development opportunity but that's not likely a repeatable event. If you put those two together, that's almost 1.1 million, 1.2 million during the quarter. I think the very last thing is during the quarter, and it's buried in revenue, we had a hedging loss on our base metal production -- not on silver, we don't hedge our silver -- but on our base metal production of over a million dollars. And those were related to contracts that we had placed primarily for zinc, to a lesser extent lead, in 2003 that matured in 2004.
A lot of those factors aren't readily apparent to you, I appreciate that. Let me look at our financials and even taking out the exceptional items, we would have been profitable this quarter. So our expectation is excluding exceptional items or extraordinary items, they're not really extraordinary but exceptional, we think we're going to be profitable in the third and fourth quarter, given these metal prices and our production profile.
Haytham Hodaly: Now, you mentioned the base metal hedging. Is there anything that's going to show up in the third and fourth quarters?
Geoff Burns: Our hedging levels now are much closer to what the current market is, we're a little negative on the lead because lead is, as you're probably very aware, the last time -- I didn't look today -- but we traded almost a thousand dollars a ton for lead, which are I don't know how many year highs, but our program is probably around 825, 800 on the lead side. On the zinc, we're around 900 dollars on the zinc side. So, we don't, you know, we're not expecting that same level. Most of those contracts that are entered in 2003 are finished and we're now seeing much more market close prices on our program going forward so we're not expecting that for long.
Haytham Hodaly: Okay. And just Quiruvilca, I mean there has been discussions in the past about looking at finally shutting down Quiruvilca. Obviously with silver prices over 6 dollars, it doesn't justify it at this point. But what to you use in looking at your long-terms -- sorry -- I guess what's your long-term silver price and what do you use in assessing whether Quiruvilca should keep going or not.
Geoff Burns: Well Haytham, I think the biggest thing right now is we've come into a couple of new veins that were not known before and are within the framework of our current infrastructure/development. Right now, our expectation is that we'll see continued production there at least for another 3 years and hopefully beyond. We're still looking at a long-term silver price at $5 and that's the basis for our continuing to mine or not mine.
Haytham Hodaly: And one final questions, Geoff. With regards to La Colorada, can you give us an idea of what 2004 cash costs will be like? Can you give us an idea of 2005, just so we can assess whether these problems will flow into 2005 or not?
Geoff Burns: Yeah, we're looking into that too, we're looking at in excess of 3 million ounces, the number is in my mind, it's about 3.2 million ounces of production in 2005 and we're looking at cash costs of $3.50/oz.
Haytham Hodaly: Okay. Perfect. Thank you Geoff.
Operator: Thank you, our next question is coming from Adrian Day of Global Strategic Management.
Adrian Day: Yeah, good afternoon. I have 3 quick questions if I may. First of all, is there any -- should I just ask them all in one go -- first of all is there any development on Ducat at all, or any expectations? The second thing is on the silver market you talked about government supplies; are we talking about China there and if not can you talk about China for a second? And then thirdly are you seeing any new acquisition opportunities or, you know, do you see them as really dried up?
Geoff Burns: Okay. Thanks Adrian, I'll... I think I scribbled down those questions in order. Ducat. We know that Ducat is in production. Last year it produced about 9 million ounces from the information that was provided to us. This year I think it's scheduled to somewhere around 12-13 million ounces. We're not seeing the profitability that we would have liked to see out of Ducat, had we been the operators there. And I think I wouldn't be surprised to see if there is some strategy that would allow us to either exit Ducat or conversely take a higher degree of control. Right now we maintain it at zero value, we're not showing -- as you are aware -- we're not showing it in our production. It is a gem of a silver asset, it is in production. I think we have one or two options there as I said; one is to find a way to exit with some value or take a higher interest. And I'm going to leave my comment at that.
In terms of silver market, we're certainly seeing continued sales from government sectors to offset the deficit. At this stage, we're not sure, at least the information that we're seeing, whether that's China or whether that's coming from other sources, potentially even India. Our expectation is that China, over the last 4 years, has been liquidating somewhere between 60-80 million ounces of silver per year, and we don't see that as sustainable. Now there is not a lot of transparency in China, there is not a lot of transparency with respect to their holding, but we just don't believe that we're going to see the same levels of government liquidation as we have in the past. The above ground stockpiles, they're kind of like the water in a barrel. We know it's coming down, we don't exactly know how much is left in that barrel but we know at some point it is going to run out. Whether it runs out in China, or if it runs out from other above ground stockpiles, or it runs out of India, none of us can be sure. What we can be sure of is the fundamentals continue to be strong.
In terms of acquisitions, certainly Morococha has come on board this year, we're just finishing that up. As I mentioned to Haytham in response to one of his questions, we did look very hard at another silver acquisition earlier this year and spent a considerable amount of money on it. Unfortunately pricing on that particular asset was beyond what we thought was fair value, so we bowed out of that process. There are still acquisitions out there; we are still very aggressive in terms of looking at that. It is our fundamental goal, above and beyond our internally generated growth, to provide additional silver opportunities for our shareholders. They are out there and we are going to be on top of them. I can assure everyone listening about that.
Adrian Day: Okay, thank you.
Geoff Burns: Thank you, Adrian.
Operator: Thank you, our next question is coming from Ronald Solberg of Viking Asset Management.
Ronald Solberg: Yeah, good morning. Thank you very much for your comments. My question is when your company gets to the point in the future where you're going to have more free cash flow, is it likely that would use it at that point for further acquisitions, for share buy-backs, or would you start a dividend? And if you did begin to pay a dividend, is it possible that you'd consider paying it out in physical silver?
Geoff Burns: Thanks Ron, that's a good question. We have a number of growth projects in front of us; we are going to use the funds that we have accumulated, as well as continuing cash flow to make sure we can deliver on those growth projects and provide the production profile. When we get to a point where we have excess free cash flows above and beyond the growth projects we have in front of us, I think we will make a decision on A) -- as you pointed out -- dividends and dividending back out value to our shareholders, or B) -- and we've heard this a number of different times -- on holding onto physical silver. I think those are both genuine opportunities and genuine things we will consider for the shareholders, and I wouldn't rule either one of them out in terms of holding onto physical silver and not selling and/or returning cash to our shareholders to let them decide where they would like to invest that cash. We are probably, in reality, we are probably 18 months to 24 months away from that, having to make that decision. And rest assured we'll inform you of what our thoughts are when we get to that point in time.
Ronald Solberg: Okay, thank you. I have one last question, if I may? You said you're still in fairly aggressive acquisition mode, at the same point you've just recently paid down all your debt on the balance sheet. Is it possible that you would consider leveraging the balance sheet again in the context of a bigger acquisition?
Geoff Burns: Ron, the answer is absolutely. Under the right circumstances, I think some leverage on our balance sheet is fine, I think it provides additional leverage to shareholders and I think on a project basis, if it's the right acquisition. Some leverage is a good thing, and Pan American would not at all be opposed to putting a project financing in place, again, given that the terms are fair and reasonable for the project.
Ronald Solberg: Okay, thank you very much.
Geoff Burns: You're welcome.
Operator: Thank you, our next question is coming from Terence Ortslan of TSO & Associates.
Terence Ortslan: Thanks. How much capacity do you think you have on the balance sheet that is cash and the debt, excluding any new issues?
Geoff Burns: Hey Terry. You know, that's an interesting question. I don't think we've really tested that capacity. Certainly debt-free with our market cap, one would assume that under the right circumstances, something in the neighborhood of $100-150 million in leverage is probably a very do-able scenario. Again, given the right project and the right mix. To be frank, we haven't actually gone out and tested that market to see what that capacity is.
Terence Ortslan: Just for the second half, could we go over the budget and say what you expect the cash cost's going to be?. And also your total cost and also your analysis?
Geoff Burns: Yeah. Second half I think we're going to see our cash cost come much lower down to, on a consolidated basis, around $3.50/oz.
Terence Ortslan: Great.
Geoff Burns: Okay. And in terms of production, assuming we get Morococha closed as we're anticipating, we're probably looking at about 6.5 million ounces of silver in the second half of the year.
Terence Ortslan: Your total cost should be approximately, what, $4.40 or so per year?
Geoff Burns: Yeah. Rob could you maybe help me out with what you think the total costs are going to be including our depreciation charges?
Rob Doyle: Sure, Geoff. Roughly on a consolidated basis, I think you have to add about a dollar above the cash cost, so if we can get our cash costs for the remainder of the year down to around $3.50, if you add a dollar, that would be $4.50/oz.
Terence Ortslan: Okay, that's good.
Rob Doyle: Yup.
Geoff Burns: That'd be for the second 6 month period.
Rob Doyle: Yup.
Terence Ortslan: Great, thanks very much.
Operator: Thank you. As a reminder if you do have a question, please press 'star, one' on your telephone keypads at this time. We do have a follow-up question coming from Haytham Hodaly.
Haytham Hodaly: Geoff, a couple of quick questions. Actually, a question and a comment. Morococha. You indicated the closing August 23rd I think you said, is that correct?
Geoff Burns: That's correct, Haytham.
Haytham Hodaly: And how will you account for it in terms of would you account roughly for like a half year or previously you'd been talking that, you know, it'd be retroactive to a certain point in time.
Geoff Burns: Yeah, in terms of production, Haytham, we're probably going to look at accounting production from July 1 forward, so it'll make a nice clean cut-off. So it's 6 months on the production side. On the profit side, we're expecting Argentum -- where we pick it up -- to have a significant cash balance, reflective of the earnings that it's made certainly for the first 6 months of this year. And the likely impact of that will be, on an accounting basis, will be just a reduction in the purchase price. So our effective purchase price for the 92% is going to be about $35 million. Net net when we're all done we expect that number to decrease significantly so we'll have a much lower carrying value. And then consolidated results July 1 forward.
Haytham Hodaly: Okay, and one last question. I guess you talked -- or a comment. You talked a little bit earlier about potentially capitalizing versus expensing it, I think one was Manantial Espejo, and maybe other projects. You know, just to give my two cents, I think more companies should be going towards expensing everything like that at this point, just, it really shows the profitability of the company. And I would probably say I wouldn't capitalize anything you don't have to capitalize at this point.
Geoff Burns: Haytham, your comment is duly noted. Let me just give you a bit of background to make you feel comfortable. Right now, we're carrying Manantial at about $2.5 million, which has strictly been our property acquisition costs and we've expensed everything since basically early 2003 when we got involved in Manantial and that includes all the drilling and all the pre-feasibility work we've done so far. Where we're going to get at the end of August is with our scoping study, we are going to have in our hands what is very clearly highly economic projects, at which point I think it prudent and correct to start to capitalize, or we're going to just defer that decision until we have a final completed feasibility in our hands. And your comment is very accurate, very much in tune with our thinking. We're going to err on the conservative side here, we don't want to end up with a large carrying value; it really doesn't reflect what the potential of the property is. But at this moment in time, what we do know, we have an economically viable project on our hands and I think accounting actually dictated that we start to capitalize.
Haytham Hodaly: Excellent. Thank you, Geoff.
Geoff Burns: Okay, thanks Haytham.
Operator: Once again, for any further questions, you may press 'star, one' on your telephone keypads at this time.
We do have a question coming from Peter Struby of Struby Associates.
Peter Struby: Good work, you guys are doing a good job these days, Geoff. I'm particularly interested, having spent a lot of time in Peru, on what you see as the future for different forms of increased taxation in Peru. There's been an awful lot of talk about it in both Chile and Peru, and in Chile some things have been done and there've been I think a couple of Bills introduced into the Peruvian Congress relating to this. And I don't know what the latest stint on their treatment, but it could have a serious effect I would think on the profitability, whatever form the taxation might take on Peruvian operations for miners, which obviously very important to you. And so I was wondering as a first question what the latest was on that and how the recent developments have, in your view, affected the outlook down there.
The second question relates to the base metals production by Pan America, whether my recollection is, certainly back in the old days, Morococha used to produce a lot of base metals and a certain amount of copper. I think that was taking off, some of that was taken off at least with the separation of Panacocha but base metals still must represent a fairly important factor in your overall production and your overall byproduct costs and credits. So I was just wondering if you could touch on that a little bit.
Geoff Burns: Okay, Peter, absolutely. Let's go to your first question on Peru. I think it's been a fairly well publicized development in Peru that they've been looking at a net smelter royalty, similar to what has also been very recently introduced in Chile. I can't say we're very excited about that development, but the reality is that in Peru, mining is just about 50% of the gross, 50-60% of the gross national profit. Very, very, important to the national economy and in any economic situation like you find in Peru, where they're struggling to raise, you know, revenues or their social requirement, you're going to pay issues of taxation or increased taxation and occasionally, kind of out of left field, you'll see these royalty introductions.
With the royalty program that's in place, which has now been made law, in Peru, we're looking in our particular circumstance, at a royalty that'll probably be roughly 1% of our net smelter return. Our estimate right now is about a $700,000 dollar a year cost to us. We're not happy about it, we understand it. We think that in the long-term that we're going to see some continuing pressure on properties, particularly mining properties in Peru, to provide additional revenues for the government. Our strategy going forward is to look very strongly at entering into tax stability agreements, similar to the agreements granted to the Barricks of the world, and at least have the certainty in where we're going on a future basis. And I think we're very comfortable with the political environment there; what we need to do is just defend ourselves on the increasing tax environment. I don't think that's going to change any more than it changes in North America in our own personal taxes; there seems to be a preponderance to try and grab a few more dollars from all of us. But I think our process there is to continue to monitor it very closely, we're very active in the Chamber of Mines down there, which monitors things very closely and very proactively, and put ourselves in a position where we will not potentially save from the future some of these tax increases and we're working very hard on that front right now.
On the second question, yes, base metals are important to us. Morococha is a base metal producer, zinc, lead and copper, all three. The primary base metal byproduct is zinc. Approximately 50% plus of the revenue coming from Morococha is silver; it's a higher grade silver deposit actually than Huaron, so it's more dependant on the silver price. But yes, it is still very important to us, the base metal prices and as we indicated before, we do have a base metal price protection program in place, we are trying to take advantage right now of some of the high lead prices in particular, and zinc prices we're seeing over the next 18-24 months to ensure that we get very good revenues from that part of the production. Morococha is going to continue to produce 40 to 50% of it's revenues from those 3 products. That's the future of that mine; it's polymetallic, high-grade silver but it has a significant base element component and we're going to continue to monitor those prices and protect ourselves on that price line.
Peter Struby: Good, thanks very much, Geoff. Good answers.
Geoff Burns: Okay, thanks Peter.
Operator: Thank you. At this time there appear to be no further questions.
Geoff Burns: Great. Operator, thank you very much. I'd just like to take one moment to thank everyone for listening to our second quarter conference call. It is -- I am going to say this one more time -- this is the first quarter in the Company's history that we have been profitable, excluding those extraordinary items. Haytham, if you're still on the phone, we expect this profitability to continue into the third quarter and into the fourth quarter if we can continue to see the prices at the levels they are right now. And I look forward to talking to you again, sometime in late October or early November when we see our next quarter results come out. Good day.
Operator: Thank you, and thank you callers. This does conclude today's conference. You may disconnect your lines at this time and have a wonderful day. |
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