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Operator: Thank you for standing by. This is the conference operator. Welcome to the Endeavour Silver First Quarter 2026 financial results conference call. [Operator Instructions] The conference is being recorded. [Operator Instructions] I would now like to turn the conference over to Allison Pettit, Vice President, Investor Relations. Please go ahead.

Allison Pettit: Thank you, operator, and good morning, everyone. Before we get started, I ask that you view our MD&A for cautionary language regarding forward-looking statements and the risk factors pertaining to these statements. Our MD&A and financial statements are available on our website at edrsilver.com. On today’s call, we have Dan Dickson, Endeavour Silver’s CEO; Elizabeth Senez, our CFO; and Luis Castro, Endeavor’s COO. Following Dan’s formal remarks, we will open the call for questions. And now over to Dan.

Dan Dickson: Thank you, Allison, and welcome, everyone. Endeavour Silver delivered excellent results in the first quarter of 2026, setting new records in both production and revenue. The strong performance generated significant cash flow, underscoring the company’s remarkable growth trajectory. With the [ Cubo ] plant expansion substantially complete and Terronera’s operations performing near design expectations, we are entering an exciting phase for the company, and we look forward to building on this momentum as we progress throughout the year. In Q1, Endeavour produced nearly 2 million ounces of silver and 12,000 ounces of gold with base metals, totaling 3 million silver equivalent ounces. This represents a 78% increase compared to Q1 2025 with the additions of [ Copa ] and Terronera.

We reported revenue of $210 million, an increase of 23% compared to prior year with cost of sales of $160 million, mine operating earnings of $94 million and mine operating cash flow of $115 million before taxes, a 400% increase from Q1 2025. Our all-in sustaining costs net of byproduct credits were $37 this quarter. This represents a 51% increase compared to Q1 2025 when [ Copa ] and Terronera had not yet joined Endeavour’s production portfolio. It’s also worth noting that these costs were 9% lower than Q4 2025 primarily due to the ramp-up of operations at Terronera with gained efficiencies throughout the quarter, and we anticipate further reductions in these costs as we continue to optimize operations throughout the year and capital expenditures become normalized.

In Q1, Endeavor recognized adjusted net earnings of $59 million or an adjusted earnings per share of $0.21. Both direct operating cost per tonne and direct costs per tonne were elevated this quarter. To clarify how we define these costs, our direct operating cost per tonne include direct input costs associated with mining, milling and site level G&A. Our depiction of direct costs per tonne includes royalties, mining duties and purchase of third-party material. Changes in the metal prices have a meaningful impact on our direct cost per ton. For an example, a $1 increase in silver, cost per tonne rise by about $0.90 at Terronera, Guanacevi is $3.80 and $0.50 at [ Copa. ] Obviously, due to the higher royalties the mining duties, third purchase costs and federally required profit sharing.

Our direct operating cost per tonne rose by 30% in Q1 compared to Q1 last year as a result of the inclusion of [ Copa ] and Terronera into our portfolio. Both assets carried higher operating costs in Q1 than what is expected going forward. During the first quarter, [ Copa ] installed and commissioned a new three-stage crusher in ball mill, increasing plant capacity to above 2,500 tonnes per day. It remains additional plant expansion expenditures. However, these will dissipate as we move through 2026, and we expect to see benefits on cost metrics starting this quarter. In Peru, we’ve experienced pressures on attracting and retaining skilled labor impacting labor costs, training costs and overall efficiencies. We expect this to continue, but the additional costs will be offset by the efficiencies of an updated and expanded operation.

At Terronera, we’re in the infancy of operations. In Q1, we made a significant transition from a construction and start-up team to an operations team, adjusting and reducing personnel. Mine and plant metrics have steadily improved through continuous measurement, review and adjustments. As the operation settles into consistent day-to-day rhythm, cost efficiencies are expected. As onetime capital investments are completed in the first half of the year, we expect operating cost metrics to decrease with higher ore grades expected in the second half. We also expect significant improvements on a cost per ounce basis. Exploration drilling has restarted at Terronera, and we expect to provide an update later this quarter. I should note, we have not transitioned our power generation to the LNG plant, but expect to before the end of this quarter.

We have the necessary authorizations and plan to commission the LNG vaporization plant this month. At Guanacevi, cash flows were north of $20 million this quarter. The mine incurred higher operating cost per tonne, largely due to lower throughput with minor increases in our absolute costs. As an operation, the royalties, purchased ore mining duties and profit share is a significant part of that cost structure, and thus, we saw increases. Step-out drilling has commenced and also, we expect to provide results later this quarter. As of March 31, our cash position was over $232 million. Working capital was north of $173 million, which gives us a strong and stable foundation to drive our ongoing initiatives. We remain committed to advancing progress at Pitarrilla, where studies — where steady investment in exploration, studies and economic evaluation continues to move forward with the expectation to provide economic evaluation in the third quarter.

In closing, our strong financial footing and successful expansion of the Pulpa plant and the steady improvements at Terronera put Endeavour in an excellent position to meet our production targets this year. These achievements reflect our unwavering focus on operational excellence and our ongoing dedication to delivering long-term value for our shareholders. I would like to thank everyone for their continued support and engagement. And with that, I’m happy to open up to questions. Operator, let’s proceed to the Q&A session.

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Operator: [Operator Instructions] The first question comes from Heiko Ihle with H.C. Wainwright.

Unknown Analyst: This is [indiscernible] filing in for Heiko. He’s on a [indiscernible] right now. First question, the great step up at Terronera. Next week, we’ll be halfway through the second quarter. Any views of what you’ve seen with grades at site during this period so far?

Dan Dickson: Yes. We have Q1 and Q2 grades a little bit similar. Q2, we expect to be slightly higher than Q1. Ultimately, the real step-up in grade in the back half of Q3 and into Q4.

Unknown Analyst: Okay. Great. And second question, maybe a bit of a philosophical one. The Terronera approaches name plate capacity. Could you maybe talk about what you saw and learned during the ramp-up phase that maybe will be useful as you move other assets into production? And I guess, as a sweetener to that anything you expect to add to the Pitarrilla feasibility study that you may not have expected a year ago?

Dan Dickson: Yes. I mean, how much time do you have on things that we learn during the Terronera build-out phase. I mean I think as an organization, it’s our first build from scratch and there’s a lot of learning. And I think we can apply a lot of that. And in fact, in Q4 and into Q1, we did a post mortem or post review of construction of things that we can improve. So we can take that over to Pitarrilla. Obviously, continuity is a very important part. And this year, Don Gray retired and we replaced Don with Luis Castro, who’s been with the company for 21 years. But there are a lot of people that remain in the company that were involved with the construction in Terronera. If we can move Pitarrilla along in accordance with what we think is our time line sometime in 2027, starting that construction, we can benefit from it.

From processes and protocols and procedures that would be put in place at Terronera, I think those will be stronger going forward. And a lot better positioned as a company to take on a second build, so to speak. And so we’re well positioned. The biggest part of that is really understanding all the permits and permits that are required. I mean as we went through, we originally got our EMEA at Terronera about 2015, 2016, Pitarrilla already has MEA. There are some other permits that are required around MEA specifically around the tailings storage facility, and we’re going through that process to try to obtain that by Q1 of next year. But behind all that, there’s about 100 other 30-some-odd permit that you learn to go through and how to navigate that through the government.

And I think we have the ability to do that a lot quicker than what we did at Terronera. So we’re excited about what we gained from a knowledge standpoint at Terronera, and we think we can apply it up to Pitarrilla. And then for your second part of that question. At this point, there’s nothing new that’s surprising at Pitarrilla. There’s a lot of work that was done. SSR and invested $145 million. They’ve done a pre-feasibility study on underground operation O9. They did a lot of work on an open pit operation in the feasibility study that was 2012. I mean we’ve been looking at this now for 3 years. And so there hasn’t been anything, I’d say, in the last 6 months to 8 months have jumped out that’s been surprising to us. We have a good indication of what the plant is going to look like, and what the capacity of the mine is, and that will come out in due course when we put out effectively the feasibility study or 43-101 feasibility study later this year.

Operator: The next question comes from John Tumazos with John Tumazos Very Independent Research.

John Tumazos: Congratulations on all the increased production and raining cash and all those good sense. Some other companies in Mexico have had bumps in the road, one company had their plane shot down a month ago. Another company has a very tragic incident in January. You’ve got at least four locations where you’re operating, is there any particular secret to your operational success and good security results. I get to some parts in Mexico are so much better than others.

Dan Dickson: Yes. But I think that’s the specifics to it all is there are parts in Mexico that are more secure than others. And I mean it’s hard to say that we haven’t had our issues. In February, there was a code red in the State of Lisco, when one of the captains of the cartel was killed. And that on the Sunday following, they put blockades into 22 different states. And part of the State of Lisco and around Portovarta was significantly impacted with blockades of the highways. Now I don’t think there is a lot of there is some unfortunate incidents with citizens. But generally, citizens weren’t targeted. It was just the target to the government to show power, I guess, of that cartel. And for us, it impacted our supply chains, and we shut down operations for three days to make sure that if we had any safety incidents, so we could get to a hospital.

So like I say, it’s not to say that we have not been impacted. But I’d say, generally, our areas that we operate haven’t had significant violence, but we’re — we’ve got a team in place, a security team in place provides us intelligence, and we make various decisions based on what’s happening in Mexico and what’s happening in various states. So again, we’ve been at Guanacevi for 20 years and very low impact to all that. We actually sold our Bolanitos operation in January. So we’re no longer in Guanajuato. And then in Helisco, like I say, we’re an hour in Porte Varta, which is considered a very safe area in that 2-day event. And there’s about 3 million Americans and Canadians that visit that area on an annualized basis, and we’re very happy to operate there, but we keep our eyes open and ears to the ground and just trying to understand what’s all happening.

John Tumazos: Are there any variations in cost between your locations due to logistical costs where you maybe avoid a bad neighborhood or anything like that?

Dan Dickson: Yes. Nothing that would be significant I can recall back in ’08 or ’09, we made sure we didn’t drive by a certain town, which added about 35, 45 minutes of driving time up to Guanacevi, which was about 4 hours away. But ultimately, the costs associated with our security between Terronera and between Guanacevi and ultimately also now at [ Copa, ] are very similar. I mean a lot of the same procedures and protocols are in place. So from a significant standpoint, I would say no.

John Tumazos: And I apologize for even asking these questions, but…

Dan Dickson: No, those were fair questions.

John Tumazos: Investors’ minds.

Dan Dickson: Yes. No, it’s a very fair question. We get them often in our meetings with investors. So happy to answer them.

Operator: The next question comes from Soundarya Iyer with B. Riley.

Soundarya Iyer: Congratulations on the quarter. Was with another call, so I don’t know if this question has been answered. But so on Guanacevi, I mean the grades have come pretty low year-over-year. So — and like third-party material purchase have also increased and its almost 1/3. At what point does this or economics change and start to dilute margins there to purchase in third-party or we continue doing that?

Dan Dickson: Yes. I mean, with the higher prices, obviously, allows us to go after lower grade material. And the great thing is we mined Guanacevi now for 20 years, and there’s areas of the old parts in the mines, North Provenir, and what we call Santacruz, South central propane that would have material left behind that would have been running 225-, maybe even 250-gram silver equivalent material that you can go back and and mine. And as prices go up, your cutoff grades come down. Some of the grades that we’re pulling right now, where we had 275 grams more from the depth depth of El Curso, which is on Frisco ground. We pay significant royalty there, too. As we move through the year, we’re going to be going into an area called Malache, which is 100% controlled by us.

We’ve got an area near propane dose, which we mined up in 2015. We’ve been working in there. Some of that’s on is ground, some of it’s on ours. Obviously, as a management team, we continually look at grades and cut off grades and ultimately, margins. And has provided that Guanacevi is going to still continue to be profitable. And as I say, we did north of $20 million of free cash flow there this quarter. We’re going to continue to operate it. So right now, we don’t have a huge reserve base. We know we can get into and maybe into 2027 and maybe into ’28, probably extend that. We’re going through that work. We started some drilling and various areas. We start to go back into other areas and build out our resources, and we’ll have a plan in place for the end of the year of how long — much longer will be at Guanacevi.

And I suspect we can get there for quite a while, especially at these prices.

Soundarya Iyer: Got it. That’s really clear. And just 1 more on Pitarrilla FS. So is it still on — I mean, is it still targeted before 3Q 2026, I mean given that the spend — $1.8 million spend in 1Q was pretty low. So how do we…

Dan Dickson: Yes. We’ve made a lot of commitments. Our spend is a little lower in Q1 than we expected, but we’ve started to push that work. we would be probably a handful of weeks behind, not a significant amount. We’re still hoping Q3 of 2026. Maybe it ends up being more of the back half of Q3 rather than the front half of Q3, but we’ll see how all that progresses over the next couple of months.

Operator: The next question comes from Craig Stanley with Raymond James.

Craig Stanley: I think you indicated you expect grades to pick up a bit at Terronera in the second half of this year. Is that — are you going to be mining a little lose?

Dan Dickson: Yes, Craig, good question. We’re actually drilling La Luz right now. As you probably know, it’s about 150,000 to 250,000 tonnes in our mine plan — in our feasibility mine plan. So right now, we’re actually drilling a little bit to depth, so we can come up with a more efficient mine plan just because of the scale and trying to figure that out. So we took the rigs out. We were drilling Terronera this past quarter, and those rigs are going back to La Luz now that we have assays, and that will drill a loose probably until midyear and then start building a mine plan for that. So I suspect because of how things are going in Terronera that La Luz will get pushed to Q1 or Q2 of next year. But again, we’ll have drill results out before this quarter is out at Terronera and maybe some La Luz as well.

Craig Stanley: Okay. And then were you saying on Pitarrilla, you’re sort of hoping to get the final permits in the first half of next year and then start construction later in 2027?

Dan Dickson: Yes. Ultimately, we have a very good idea because of what Pitarrilla is and the resources that there in the underground sulfide resources that we’d be mining it from an underground standpoint, I don’t necessarily think the economic evaluation is going to be that far off than what we’ve historically known. But really, the gating item is the permit to build the tailings storage facility, which is going to be a dry stack facility. We’ve been going back and forth with the authorities on that, hoping we can get through it relatively quickly. Now at the beginning of the year, we thought maybe Q1 2027, we could get that permit. Things have seemed to be still sticky when it comes to permits in Mexico. We’ve heard a lot of our peers expecting permits in Q1, and that never came to fruition, then it was going to be early Q2, and we’re almost halfway through Q2.

So I’m getting a bit nervous on time lines when it comes to permits, just because it still have — we haven’t seen a real floodgates open, so to speak. But that’s what we were targeting. And then if we could start building in next year, that would be great. Now we are still continuing forward with our construction cap this year. So we have ultimately a plan of 800 beds. I don’t — I think we’re putting in maybe a little bit less than that to start with 250 to 300 beds, and we’re still making our movements to purchase mobile equipment and plant equipment, so we can do the basic and detailed engineering properly when it comes to the plant. So we’re still pushing ahead, but the real kicker for a construction decision is that tailings and permit.

Craig Stanley: Okay. And then just the last thing for me. When you’re out talking to institutional investors, does M&A come up more in regards to Endeavour Silver being a potential target? And because when you look at the silver space, you have a lot of these companies with much larger market caps like Pan American core HACA First Majestic and then it sort of drops off and you’re sort of in this sort of middle stage before you get that into sort of the real smaller producers. Just curious like Terronera has now ramped up. Is that something that’s in discussion. Again, more with clients.

Dan Dickson: Yes. I mean, with the investors, people always ask, like how do we want to grow? And we say we want to be a senior silver producer and Terronera has ramped up hitting criteria through the plant. I think once those grades really start coming through, and we get our costs down to expectations, I think there’s a lot more value in our shares there. We want to build that value in our shares. Ultimately, we’re a pretty young management team. I think we’re pretty still hungry to grow and find things, never say never. But it’s such a small space. There’s only a handful of people that can actually look at us, and there’s only a handful of things that we can look at. So we have a pretty good corporate development guy. Some days, he works hard. He’s sitting right in front of me. So we are always looking at things and trying to figure out the right combination for Endeavour.

Operator: We have a follow-up question from Soundarya Iyer with B. Riley.

Soundarya Iyer: Sorry for just about getting another question. Just curious on the capital…

Dan Dickson: No problems at all.

Soundarya Iyer: Curious on the capital allocation part. You had $200 million — $250 million in cash. And then this has been a record operating cash flow. Is it — how are you thinking about like some dividend buybacks, not this year, maybe, but in the future…

Dan Dickson: Yes, I think it’s very clear — yes, that’s a fair question. I mean, for us, we’re still on a growth trajectory. We’re really excited about what we have at Pitarrilla. I think the market is going to understand that when a feasibility study comes out in Q3. The expectations, the cost to build is going to be somewhere between $500 million and $600 million. If we keep generating cash at this rate, we’ll have a good chunk of that built into our balance sheet by the end of the year and then obviously, cash flows into 2027. Until Pitarrilla is built and operating and providing its cash flow is probably the time we’d start looking at dividends or share buybacks. But at this point in time, our — we feel like the rate of return that we can get out of Pitarrilla will be very valuable for our shareholders, and that’s what the cash that we’re generating is going to be used for.

Operator: This concludes the question-and-answer session. I would like to turn the conference back over to Dan Dickson for any closing remarks. Please go ahead.

Dan Dickson: Well, thank you, operator, and thanks for all our listeners today. I think Q1 was a good quarter for Endeavor, but we still have more expectations going back to the year. As you say, Terronera’s grade should pick up in the second half of the year, [ Copa ] will be operating close to 2,500 tonnes per day. And we’ll get more rhythm at Guanacevi, Terronera and [ Copa ] that ultimately, we expect a very strong next 3 quarters and specifically the second half of the year. So we’re excited with what we have. We’re excited where we’re going, and I look forward to getting the feasibility to say out of it in the second half of the year as well. So thanks for joining today.

Operator: This brings to end today’s conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.

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