Wheaton Precious Metals Corp

NYSE:WPM

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Wheaton Precious Metals' 2024 Fourth Quarter and Full Year Results Conference Call. [Operator Instructions]. I would like to remind everyone that this conference call is being recorded on Friday, March 14, 2025 at 11:00 a.m. Eastern Time.

I will now turn the conference over to Ms. Emma Murray, Vice President of Investor Relations. Thank you. Please go ahead.

Thank you, operator. Good morning, ladies and gentlemen and thank you for participating in today's call. I'm joined today by Randy Smallwood, Wheaton Precious Metals' President and Chief Executive Officer; Gary Brown, Senior Vice President and Chief Financial Officer; Haytham Hodaly, Senior Vice President, Corporate Development; and Wes Carson, Vice President, Mining Operations.

Please note for those not currently on the webcast, a slide presentation accompanying this conference call is available in PDF format on the Presentations page of our website. Some of the commentary in today's call may contain forward-looking statements and I would direct everyone to review Slide 2 of the presentation for more details. It should be noted that all figures referred to on today's call are in U.S. dollars, unless otherwise did.

With that, I'd like to turn the call over to Randy Smallwood, our President and Chief Executive Officer.

Thank you, Emma and good morning, everyone. Thank you for joining us today as we review Wheaton's fourth quarter and full year results for 2024. Driven by our diversified portfolio of high-quality and long-life assets, I am very pleased to report that Wheaton achieved record revenue, adjusted net earnings and operating cash flows in 2024.

We realized annual production of 635 gold equivalent ounces, exceeding the top end of our production guidance for the year. The strength of our fourth quarter results was underscored by record quarterly production from Salobo resulting in record overall gold production for the year. In 2024, Wheaton remained focused on reinforcing our industry-leading growth profile by acquiring 4 new investments. Haytham will provide further details on these recent acquisitions, which include a gold stream on Montage Gold's Koné project, the largest streaming transaction completed by a single streamer in the past decade.

Each of these investments further enhances and diversifies our portfolio by expanding our geographic presence and strengthening our strategic partnerships. And we are excited to welcome our new mining partners and we look forward to supporting them in advancing these projects. Wheaton's estimated growth profile is unmatched in our sector. This impressive growth is readily apparent in our 5-year production forecast where we estimate annual production increasing by 40% to 870,000 gold equivalent ounces by 2029. Along with organic growth from our existing operations, we expect to see inaugural production from 9 different assets in the next 5 years, all of which have received their key permits and are either nearing or already well into construction.

In 2025 alone, several development projects are currently expected to begin production, including Artemis Gold's Blackwater project, which has already made its first gold pour in late January, B2Gold's Goose project in Nunavut, Waterton's Mineral Park project in Arizona and Ivanhoe's Platreef project in South Africa. To further demonstrate our confidence in Wheaton's growth profile, we are pleased to announce a 6.5% increase to our quarterly dividend and are proud that Wheaton's payout ratio continues to be a leader in the precious metals sector. We are also proud to be 1 of only 2 resource-focused companies to be recognized by Corporate Knights as one of the 2025 Global 100 Most Sustainable Corporations and to be the only streaming company upgraded to AAA ESG rating by MSCI.

These accolades reflect our commitment to support responsible operations across all areas of our business and underscore the quality of the mining partners that we collaborate with. I would also like to mention that last week, we announced the winner of our inaugural Future of Mining Challenge. Wheaton, with the assistance of Foresight, launched this challenge in September of 2024 to support the mining industry's important goal of delivering essential commodities and materials in a more efficient, sustainable manner. The 2025 winner is ReThink Milling, whose innovative grinding technology demonstrates immense potential to significantly lower energy consumption, leading to reduced emissions and operating costs and ultimately improve operational efficiencies. Stay tuned for our 2026 Future of Mining challenge.

And with that, I will now hand the call over to Wes Carson, our Vice President of Operations, who will provide a more in-depth look at our operating results. Wes?

Thanks, Randy. Good morning. Overall production in the fourth quarter came in higher than expected, driven by strong outperformances at Salobo, Constancia and Peñasquito, further highlighting the strength of these significant assets in our diversified high-quality portfolio. In the fourth quarter of 2024, Salobo produced 84,000 ounces of attributable gold, representing record quarterly production, an increase of approximately 17% relative to the fourth quarter of 2023, driven by higher throughput as the ramp-up of the Salobo III expansion continued as well as higher gold grades and recoveries.

On January 28, 2025, Vale announced the completion of the Salobo II ramp-up and continuing improvements in performance at both Salobo I and II. On March 4, 2025, Vale informed Wheaton that it had achieved a sustained throughput capacity of over 35 million tonnes per annum over a 90-day period, indicating the completion of the second phase of the Salobo III expansion project. Following a review of the final completion test, Wheaton anticipates advancing the remaining $144 million of the expansion payment. In the fourth quarter of 2024, Constancia produced 970,000 ounces of attributable silver and 18,200 ounces of attributable gold, an increase of approximately 16% for silver production and a decrease of approximately 18% for gold production relative to the fourth quarter of 2023. The increase in silver production, which represents a quarterly record, was primarily due to higher grades.

The reduced gold production was the result of lower gold grades as more material was mined from the Constancia pit and reclaimed from stockpile compared with the previous year. The decrease in gold grade was partially offset by higher throughput. Hudbay announced that gold production in 2025 is expected to be lower than 2024 levels due to additional high-grade gold benches in Pampacancha, which were mined ahead of schedule in late 2024 instead of 2025 as originally planned. The Pampacancha deposit containing relatively higher gold grades is expected to be depleted in early December 2025. In the fourth quarter of 2024, Peñasquito produced over 2.4 million ounces of attributable silver, an increase of approximately 138% relative to the fourth quarter of 2023 as prior year operations were impacted by a 4-month long labor strike.

Newmont has indicated that in 2025, co-product production is expected to decline as mining transitions from the Chile Colorado pit back to the Peñasco pit, which contains relatively lower silver grades. On January 22, 2025, Artemis announced the commissioning of the grinding circuit at the Blackwater project had advanced and milling of first ore had commenced with the first pour of gold and silver being announced on January 29, 2025. Commercial production remains targeted for Q2 of 2025. Also during the quarter, Waterton's Origin Mining continued to advance their Mineral Park project with the installation of new crushing and milling circuits nearing completion.

Project construction continues to progress on track with the first ore to the mill expected in Q2 of 2025, followed by the anticipated ramp-up to commercial production during the second half of the year. Due to strong performance in the fourth quarter, Wheaton exceeded the upper limit of its annual production guidance in 2024, surpassing the midpoint of the guidance range by approximately 9%. The company anticipates that 2025 GEO production will continue to grow from levels achieved in the previous year. This forecast growth is driven by expected stronger attributable production from Antamina, the anticipated start-up of several development projects, including Blackwater, Goose, Mineral Park and Platreef and a stable forecast for Salobo production.

Attributable production is projected to increase at Antamina in 2025 due to expected higher silver grades caused by a higher ratio of copper zinc ore versus copper-only ore mined in 2025. Attributable production is forecast to be consistent at Salobo in 2025 with slightly lower grades as per the mine plan, offset by increasing throughput at Salobo I, II and III continue to -- as we continue to see an improvement in plant availability and overall utilization, complemented by a best-in-class preventative maintenance culture that has been implemented consistently across the entire site. Increased production from the aforementioned assets is anticipated to be partially offset by lower production from Peñasquito and Constancia.

Wheaton's attributable production in 2025 is forecast to be 350,000 to 390,000 ounces of gold, 20.5 million to 22.5 million ounces of silver, 12,500 to 13,500 ounces of -- GEOs of other metals, resulting in total production of approximately 600,000 to 670,000 GEOs. Production is forecast to increase at an industry-leading rate of approximately 40% over the next 5 years to 870,000 GEOs by 2029, primarily due to expected growth from operating assets, including Antamina and Marmato and development assets, including Blackwater, Platreef and the Koné project. From 2030 to 2034, attributable production is forecast at an average of over 950,000 GEOs in the 5-year period and incorporates expected additional incremental production from predevelopment assets, including Santo Domingo and Cangrejos.

That concludes the operations review. And with that, I will turn the call over, one last time to Gary.

Thanks, Wes. As described by Wes, production in the fourth quarter amounted to 187,000 GEOs, a 14% increase relative to the fourth quarter of 2023, primarily the result of higher production from Salobo and Peñasquito, with Salobo achieving record quarterly production. Sales volumes amounted to 143,000 GEOs, a decrease of 8% relative to the fourth quarter of 2023, with the higher production being offset by a 40% increase to the number of GEOs produced but not yet delivered or PBND. Strong commodity prices, coupled with our solid production base resulted in record quarterly revenue of $381 million and gross margin of $247 million, an increase over the comparable period of the prior year of 21% and 40%, respectively.

Of this revenue, 62% was attributable to gold, 35% to silver, 1% to palladium and 2% to cobalt. As at December 31, 2024, approximately 164,000 GEOs were in PBND, representing approximately 2.9 months of payable production, an increase from the preceding quarter and at the upper end of our expected range of 2 to 3 months. This was due to a significant increase in quarter-over-quarter production driven by increased production by Peñasquito, coupled with record quarterly production at Salobo, with this incremental production expected to be delivered in the first quarter of 2025. G&A expenses amounted to $10.5 million for the fourth quarter of 2024 and total G&A for the year amounted to $40.7 million, being at the lower end of the original forecasted range.

For 2025, the company expects that G&A expenses will amount to $50 million to $55 million, with the increase largely resulting from costs associated with the inaugural Future of Mining Challenge, coupled with the expiring ATM program. In the fourth quarter, Wheaton recognized an impairment charge of $109 million relative to the Voisey's Bay PMPA due to the sustained decline in market cobalt prices. After reflecting the impairment charge, net earnings amounted to $88 million with a $35 million global minimum tax expense being reflected in the quarter. Adjusted net earnings amounted to $199 million, representing a quarterly record for the company, with the $34 million increase from the prior year due primarily to the higher gross margin.

Adjusted earnings per share amounted to $0.44 per share, an increase of 21% over the comparable period of the prior year. Revenue for 2024 increased 26% to approximately $1.3 billion, representing a record for the company, with the increase being primarily due to a 20% increase in realized commodity prices, coupled with the 5% increase in sales volumes. Of this revenue, 99% was derived from precious metals with 62% attributable to gold, 36% to silver, 1% to palladium and 1% to cobalt. Gross margin for 2024 increased by $229 million to $803 million. After negating the items that are nonrecurring in nature, including the effect of the $109 million impairment charge on the Voisey's Bay cobalt stream, adjusted net earnings increased by 20% to an annual record of $640 million.

Despite the persistent inflationary environment, Wheaton continued to deliver robust cash operating margins in the fourth quarter, resulting in record quarterly cash flow from operations of $319 million, an increase of over 30% relative to the fourth quarter of 2023 and paid a dividend of $0.155 per share, an increase of over 3% relative to the prior year. During the quarter, Wheaton made total upfront cash payments of approximately $115 million relative to mineral stream interests, including $44 million relative to Kurmuk, $40 million relative to Marmato, $25 million relative to Mineral Park and $6 million relative to Cangrejos.

Offsetting these outflows was the temporary repayment of the upfront cash payment of $13 million relative to El Domo. This repayment, which will be readvanced in the future, was made by Silvercorp in order to stop the accrual of delay ounces owed to Wheaton. In addition, the company made dividend payments totaling $70 million. Overall, net cash inflows amounted to $124 million in the fourth quarter, resulting in cash and cash equivalents at December 31 of $818 million. This cash balance, combined with the fully undrawn $2 billion revolving credit facility and the strength of our forecasted operating cash flows positions the company exceptionally well to satisfy its funding commitments and provides us with the financial flexibility to acquire additional accretive mineral stream interests.

Given the strength of Wheaton's balance sheet and forecasted cash flows, the company has elected to not renew its at-the-market equity program under which no shares have been issued. As mentioned by Randy, the Board has declared a dividend of $0.165 per share, a 6.5% increase from the dividend of the prior quarter, payable to shareholders of record on April 1, 2025. After declaring record levels of dividends in 2024, the company has now returned over $2.3 billion in dividends to investors since inception, which notably represents over 60% of the amount of equity ever raised by the company.

That concludes the financial summary. And with that, I will turn the call over to Haytham.

Thank you, Gary. Following the record number of deals that we announced in 2023, the corporate development team saw yet another busy year in 2024, committing $910 million on 4 precious metals transactions resulting in the addition of multiple top-tier assets, further adding to our already impressive development project pipeline. I presented the deals of our stream with Montage Gold relative to the Koné project on our last quarterly call, the largest streaming transaction by a single streamer in nearly a decade. Since then, Montage has announced that construction has commenced and that significant progress is being made to rapidly advance and derisk the project, which remains on track to meet the expected first gold pour in mid-2027.

Once fully ramped up, Koné is forecast to become our second largest gold-producing asset for its first 5 years of production and the third largest producing asset overall. Additionally, in December, we announced the transaction with Allied Gold Corporation in respect to the Kurmuk gold project located in Ethiopia. Kurmuk is a fully permitted, high-quality evolvement project that we believe offers significant exploration potential. Kurmuk is set to be the first commercial gold mine in Ethiopia and is supported by a team who has a proven operating track record. Attributable gold production is forecast to average over 16,000 ounces of gold per year for the first 10 years of production and Wheaton anticipates receiving ounces in the second half of 2026.

Only a few weeks ago, Allied announced a strategic partnership with UAE-based Ambrosia Investment Holding to crystallize value on a portion of its Sadiola mine in addition to participation in a private placement, which when combined, generated proceeds of over $500 million. Allied has indicated that these proceeds will be used in part for the further development of Kurmuk, providing crucial financing and further derisking the project. We are excited to partner with the Allied team who has a strong operational background and look forward to supporting them along Kurmuk's path to production.

Lastly, subsequent to the quarter, we announced an amendment to the Blackwater precious metals purchase agreement whereby the amount of payable silver received by Wheaton will now be determined based on a fixed ratio of silver to gold ounces rather than fixed recoveries. This amendment presents a win-win solution for both Wheaton and our partner, accelerating the receipt of payable ounces to Wheaton, while the additional $30 million payment is expected to fully fund Artemis as they enter the final stages of ramping up to commercial production which is anticipated for the second quarter of 2025.

With that, I will hand the call back over to Randy.

Thank you, Haytham and thank you, Gary, for the integral role that you have played in the last 17 years. Many of you know -- already know that Gary will be stepping down as the CFO at the end of this month. Gary's legacy will be marked by a strong financial foundation, a culture of excellence and focus on sustainable growth. I am immensely grateful for his contribution. And I think I speak for the entire Wheaton team and stakeholders in wishing him all the best in his next chapter of his life. Thank you.

In summary, 2024 was a very strong year for Wheaton, distinguished by several key highlights. With production of 635,000 gold equivalent ounces, we exceeded our annual guidance, generating record cash flows of over $1 billion and distributing record dividends of over $280 million. Our pipeline of development projects was further derisked by construction advancements and the receipt of various key permits by our partners, further strengthening our impressive organic growth profile of over 40% in the next 5 years. We continued to grow our asset base with the addition of 4 new acquisitions this year, adding further diversification by commodity, operator, region and development stage.

Our balance sheet remains one of the strongest in the industry, providing ample capacity to continue adding accretive high-quality streams into our portfolio. We declared a record level of dividends in 2024. And after raising our 2025 annual dividend, we'll continue to provide one of the highest dividend payout ratios in the sector. And lastly, we continue to demonstrate leadership in sustainability with sector-leading ESG ratings and external recognition.

So with that, I would like to open up the call for questions. Operator?

[Operator Instructions] And your first question comes from the line of Lawson Winder from Bank of America Securities.

Congratulations on a fantastic 2024. And then also, Gary, to you, congratulations on a fantastic career at Wheaton and all the best going forward. Guys, I just, first of all, wanted to start off on the dividend. I think the market's been pretty impressed with the increase that you guys have demonstrated with the announcement last night. But I mean the payout based on your operating free cash flow in 2024 is a little bit lower than the sort of 20% to 30% range that you talked about in the past. Is there -- is there a thought to maybe push that a little bit higher going forward?

Lawson, it's Randy. Thanks for calling in. I mean it really comes down to the opportunity set that we see in front of us, right? We want to maintain a healthy balance sheet to take advantage of what we see is still a relatively strong opportunity set in front of us. And so I wouldn't call -- I mean, I think it really comes down to how strong that balance sheet is and how much we've got in terms of commitments coming down the pipe and finding that right balance. And so if you see us with an even stronger cash balance and factoring in, of course, commitments that we have, we do have quite a bit of construction going on over the next while. So we'll be co-funding with the operators to get these assets up and running.

It really comes down to just making sure that we have that capacity to take advantage of the opportunities. But at the same time, knowing that we want to do -- want to keep committing to that progressive dividend. And so I think moving it up at the rate that we did this year allows us to do that. We have some commitments coming up this year. I know Haytham's got a long list of opportunities out there in terms of helping fund projects coming in and adding to our growth profile even more. And so it's really coming down to that balance. And I would say that the best way to sort of estimate that is look at how much cash we have on hand during the third or fourth quarter and that's going to be a real good indicator of what we're going to do to the following year. And at this time, we felt we had that extra capacity this year.

Yes. That's really helpful context. And just thinking about that capital deployment in the pipeline and we often talk about the size of the deal and the type of deal. But I mean, if you just look at the total deal, like -- could you see the possibility of deploying the same amount of capital in 2025 as 2024? Yes, so thinking about that way. And then thinking about that in terms of the contractual obligations, you guys have disclosed about $882 million of contractual obligations. Does that -- to what extent does that influence how much you feel you could deploy in 2025?

Sure. Maybe I'll take that question, Lawson. Just with regards to how much we could potentially deploy in 2025, let me just go back and give you a little bit of history. Over the last, I'd say, 10-plus years, on average, we've deployed over $800 million a year. And that's not -- that's on accretive high-quality transactions. We continue to see in our current profile opportunities that range anywhere from $100 million or up to as much as $400 million. There is the odd one that is somewhere between $500 million and $1 billion. So we do see an opportunity to continue to deploy a lot of capital. That being said, we're only going to do it in a very accretive manner and very, I would say, manner similar to what we've actually done in the past. We're not trying to do every deal. We're trying to do the best deals and we're trying to them at the best price.

Lawson, I would add, currently, what we're seeing is a lot of investment in the gold space. Clearly, having gold breakthrough $3,000 earlier today, it's a very strong gold market and we're seeing a lot of investments in that. So most of the transactions we're looking at right now is gold streams, on gold assets. The copper market will wake up at some time. There's just -- when you start looking at long-term demand and what we've typically seen is that copper is -- it's a much more capital-intensive space and there's a much higher need for copper. So in the gold space, we tend to see $300 million, $500 million, maybe $700 million deals as we've shown. But boy, when you start getting into the copper space, that's when you start seeing the $1 billion plus. And so we have to make sure that we're prepared for that when that copper market does when we start seeing some reinvestment into the copper space.

Okay. That's helpful. And then just maybe just a bit of a modeling detail question on the total contractual obligations for 2025. How much of that $882 million do you expect to deploy in this quarter and what are the kind of the moving parts driving that?

Well, this quarter is just about done. So in terms of the first quarter itself. I mean clearly, Salobo, Vale has been successful in terms of satisfying the second phase. So that payment will be made shortly. I'm not sure the actual day, whether it falls into this quarter or not but we're going through the process of getting that done. They've definitely satisfied that. So that's going to be the first one. We've got active construction on all the other projects and stuff. I don't know if we've got a quarterly breakdown but yes, I'd have to say it's -- I mean, I would say it's pretty evenly spread over the entire year. And so if you're looking at that, it's probably a couple of hundred million, maybe a little bit more heavily weighted to the front end just with that $144 million payment towards Vale.

The big one is going to be Koné, which I think is going to be more back-end weighted. But at the end of the day, with $144 million going out over the next 30 days, as Randy said, it's probably going to be pretty stratified across the 4 quarters.

And your next question comes from the line of Tanya Jakusconek from Scotiabank.

And Gary, good luck on your next adventure.

Thanks, Tanya.

From a -- yes, just wanted to turn back to some modeling questions, if I could. Thank you for the color on outflows of the commitments. Maybe just as I think about the year and assuming obviously, commodity prices, [indiscernible] which they don't but you do your production base pricing anyways. I know that we have the new mines contributing about that 20,000 to 25,000 GEOs towards the latter part of the year. How should we think about the first half versus the second half? Is it like 47-48 [indiscernible] like how should I...

I would think it's about 45-55, 45% in the front half, 55% in the back half. Again, mine startup is challenging in terms of picking production levels and how fast you can ramp up. You kind of test the system. And if it works, you test it a little bit more. And if it works, you test a little bit more or you have to step back a bit, right? So it's always a tricky process. And so it's always tough to sort of pick off that. And so I would definitely say we will definitely see a bias towards the latter half of the year in terms of production. But I would characterize it about 45% upfront and 55% in the second half.

And [Technical Difficulty] coming in, Randy, what other operations within your portfolio has a seasonality to it that I should be aware of or any downtime?

I'll let Wes talk to that on the operations side.

Sure. I'd say the main one, Tanya, is Salobo and Salobo does have a rainy season generally in the first quarter. So we do see slightly lower production from Salobo and then that ramps up through the year. That being said, over the last couple of years, they've done quite well. They installed a new pumping system in the bottom of the pit a couple of years ago and that really has mitigated a lot of the challenges that they had previously around that rainy season. Most of our other operations are not really seasonally affected though. Salobo would be the largest single one for sure.

Okay. And then, Wes, do have any grade differential in the first and second half or any maintenance downtime for the second half?

Nothing out of the ordinary, no. It's pretty standard across the year and everything. We don't have the major -- in the last couple of years, we've had some fluctuations on, say, Constancia with Pampacancha coming in and out. That's reasonably flat across the year. And really Peñasquito will be the same there and Peñasco for most of the year. So no significant changes kind of over the year. It really is those operations coming on in the latter part of the year that makes the difference.

Okay. That's very helpful. And I guess I should ask the DD&A but is that a hopeful ask?

Sorry, your line is kind of -- can you just repeat that question? I didn't...

Oh, sorry. I was hoping you could add an idea for your depreciation? Or is that a hopeful ask for guidance for now?

Depletion, we forecast mine by mine. I think I wouldn't expect it to deviate significantly from what Q4's depletion was. But we're forecasting roughly $300 million in depletion over the year.

Okay. That's very helpful. And then I just wanted to turn, if I could, to just the deal space -- and thank you for sharing us on the deal side and the opportunities that you're seeing on the gold space. And I think, Randy, you mentioned a lot of them is in helping finance development stage projects. I just wanted to clarify if that's what I heard, #1. And #2 -- sorry, it is, okay. Perfect. #2, I do understand there are some royalties for sale as well and some in sort of bigger size, wondered if that was something you were also looking at separate from the streams?

We look at everything, Tanya, definitely. I mean we have to understand what's going on out there and we weigh every opportunity against the other opportunities we have in the pipeline, so.

Our preference is streams, Tanya but we feel that they're a much more -- a much stronger business model than the royalties. But existing royalties that are auctioned off, we'll always have a look at and try and get a sense. Sometimes we scratch our heads, the values being paid for these royalties but especially on different projects and such. But we'll look at them and see if there's a space for them in our portfolio. All in all, it's still about trying to find good quality precious metal production for our shareholders.

And I'll just add to a comment Randy made earlier. A lot -- for the last little while, a lot of the opportunities given the strong commodity price and precious metals that is have resulted in Wheaton looking at streams on these high-margin precious metals assets. We are starting to see some polymetallic assets with a good byproduct, precious metals byproducts that are coming our way. So we're probably 50-50 split on those going forward.

Okay. That's helpful. And then how do you think of the opportunities from a geographical standpoint? I only say that because a couple of your last ones were based in Africa. And I'm just thinking of how do you see your exposure? Do you feel that , that's enough Africa? Or are you back to North and South America. Just wondering geography-wise.

So I can tell you this. I can tell you, when we -- the last few transactions that we did, yes, you're right, there was a couple of 2 or 3 that were in Africa. It wasn't because we had a focus on Africa. It was because that is where the highest quality opportunities lay at that given point in time. I'm looking at my list of opportunities for the next, let's say, 12 months. And it is -- there are none in Africa at this point. So we are looking globally. But I think, generally speaking, we've exhausted probably some of the highest quality assets in Africa from a stream perspective and looking elsewhere at this point.

It's not so much the continent itself, Tanya. It's a country-by-country basis. I mean some of the most stable jurisdictions in the world are in Africa in terms of longevity and security around mining. And so it's something that you have to really assess that. And I would add that the one other aspect that we really focus on isn't so much even country risk, it's community risk. We put a lot of effort in terms of trying to understand what that risk is. And so we've been -- I mean, yes, you're correct. Most -- some of our recent transactions, obviously, in Africa and it's looks like a new area for us.

Haytham and I and the rest of the team have been looking in Africa for many years now. I would almost suggest that perhaps some of our peers are -- have learned some lessons and are factoring in a bit more political risk in their own valuations and now it's a more competitive market. We always have factored in political risk as part of our valuation process. And so I do think that, that might be a bit of a reflection. It might not be so much a change in our approach but it changes some of our peers' approach from a political risk perspective. And I think that has opened up some opportunities for us.

No, no, I appreciate that. I was just looking at it from a portfolio basis overall. And so Haytham, I think you said most of what you're looking is outside of Africa. Is it safe to assume most of it is North -- South America?

Yes, safe to assume that.

Okay. Really appreciated. And again, Gary, good luck on the next chapter.

Thanks again, Tanya.

And your next question comes from the line of Brian MacArthur from Raymond James.

And again, best wishes Gary on your next chapter going forward. My question is maybe philosophical. But I'm interested, we've had a couple of amendments to some of the PPMAs (sic) [ PMPAs ] over the last 6 months, both Phoenix and Blackwater, which is, I guess, as I looked at them, effectively putting in more capital but you're getting more ounces up front into a pretty good precious metal market.

But I'm curious whether the genesis of the transactions is more, as the company develop these projects, they need more capital, so you put it in and get a return? Or is it more that you both see a pretty good precious metal market and there's an opportunity for both of you to improve the projects upfront to what you really thought they were to begin with and therefore, get a better return for both of you or maybe it's -- those are just one-offs.

And I guess if it's the situation where you can advance projects by putting more capital in to benefit both of you. Is that something I should think about you could be doing on some of your other PPMAs (sic) [ PMPAs ] and it's an additional avenue of growth going forward?

Yes. I mean, over the last, I would say, 2 to 4 years, we've become incredibly creative on how we structure our transactions. And obviously, given the lack of equity markets, the expensive debt that's out there, we've actually been looking for ways to continue to expand on our high-quality streams, Brian. That is something we'll continue to do. And yes, there are some, I would say, methodologies that we've incorporated that not only give us additional exposure to a stream but give is additional protections on the streams and ensuring that we continue to get the streams in the manner that we've actually valued them So we -- by doing a lot of these revisions that we've done over the last couple of years, we have protected ourselves and ensured that we have a solid profile continuing on regardless of whether there's delays by our partners or not.

Randy, is there anything you want to add to that?

I think you captured it well.

Sorry, can I just follow up because I thought that was a great point you made, Haytham. But in all of this, I can assume the security of the additional stuff is as good as the original or better. Is that a fair assumption from your perspective?

Absolutely. And I would say, given what we've seen in the industry, not within Wheaton but elsewhere, that is even more important than ever.

And your next question comes from the line of Daniel Major from UBS.

Can you hear me, okay?

You bet.

Great. Yes, a few questions. Just the first one, thinking about the structure of the Montage transaction, it's quite front sort of loaded in terms of share of offtake from the asset. Is this something an evolution of the type of deal you're looking for going forward with kind of more front-loaded type repayment schedule? Or is this just specific to the transaction?

Yes, Daniel. This was a unique opportunity to supply the bulk of the financing to get this project built. One of the other major equity investors in Montage, Zijin also stepped in and supplied a bit of capital. But we supplied by far, the bulk of the capital towards this. And so what this has allowed Montage to do is, move this project forward without any project debt, so to speak. I mean there's a couple of small cost overrun facilities that are both being supplied by Zijin and Wheaton but that's only in the event of. And so to be able to move this project forward based fully on stream funding is a unique aspect.

We haven't seen a lot of that in the industry. And I think it's really an indication of some of the opportunity set that we see out there to continue to grow our own business but also being a supportive partner. The flexibility of a stream relative to bank debt is very attractive. And so you're right. When you look at this one, it's very front-end loaded starting off at just around 20% of the gold production but dropping down long term to a number closer to 5% of the gold production.

And that is very similar from Montage's perspective, it looks like project debt. It's got -- it's lumpy at the front end when the project gets up and running. And then it gets paid off in those early years and then they have a bit of residual tail around the stream that carries on. So we think it's a great unique approach. We've definitely had some interest from other companies looking at this because the appeal of this versus dealing with project debt is -- and the flexibility, the inherent flexibility that comes with it, just so much more attractive.

And so I don't know, Haytham, you got anything to add to that?

No, I think that was -- that was a great office there. I would say in any project, obviously, a company as they're building a mine, they want to get their payback as fast as possible. And as you can see from the way we structured it, we are also getting payback during that same upfront. And so that -- going into a high-quality asset that can give us that payback quickly, that's always positive. And I would also say this positions us well from a security ranking perspective. So everything we've done with that specific asset has been to protect us and to provide as much capital back as possible. So we're very excited about that opportunity.

Okay. And then maybe just to follow on that, I mean, when you look at the risk profile against the valuation, do you feel like this is a approach of being a much larger proportion of the funding, is a higher risk from your side?

It absolutely is higher risk. But that being said, I would also say that that's where the opportunity lies. We've got the capital to do it and we're getting much higher returns to reflect that higher risk as well. So definitely from a risk return perspective, it makes sense. And Gary, would you want to add something to that?

Yes. You have to remember that like we're pretty much the only creditor at the table with this type of structure. So that gives us control, if a downside kind of scenario manifests. It gives us a lot more control of how we navigate that process. And we -- we're a very patient capital provider. So we're going to be aligned with our partner to get them through that situation and get the operation up and running again, whereas debt providers may not have that same intent. So we actually think that it's -- in some ways, it's less risky.

Okay. Then the next question, again, on the -- to follow up on the question -- the answer you gave around the list of opportunities going forward and then not being in Africa. First Quantum has -- spoke about potential stream financing in Zambia. Should I take that comment as you're not in that process?

I would say that process hasn't officially started yet. I think they've been talking about it for a while and there's obviously interest to look at all high-quality assets on our part.

Okay. And one more, if I could, just on the profile through the year. You mentioned about produced but not delivered volumes being higher and then principally unwinding in the first quarter. Can you give us any guide on that? Should we just assume that does they normalize in Q1? Or is it going to be over the first half? Any sense there?

I would think that it's going to come back down to kind of the midpoint of our 2- to 3-month estimate in Q1 and then kind of hover there for the rest of the year. But we can never predict that with pinpoint accuracy.

Got it. So 20,000 ounce, 25,000 ounce delta on the quarter is a reasonable assumption?

Yes.

And your next question comes from the line of William Dalby from Berenberg.

Yes, just one question really for me is around Salobo, obviously, a phenomenal quarter there, really demonstrating what's achievable from that. But given still firmly cornerstone asset for Wheaton but there's been sort of a bit of uncertainty around the sort of longer-term production profile there. Obviously, Vale last released a technical report in 2022. We've seen a few adjustments in terms of throughput and grade expectations. So really, my question is, could you possibly map out what your sort of internal expectations are for the production profile at Salobo out to, say, 2030 and then sort of a general long-term view there? That would be very helpful.

Yes. Thanks for the question. I mean really, the way that we're seeing it with Salobo is fairly static over the next while. We did see grades starting to trend down a little bit. But same as most open pits. As you go through different phases, when you get to the lower part of a phase, the grades go up and then really, they go back down as you get up to the upper part. So it's fairly static as you go across. I think one of the exciting things, though, is if you look at some of the announcements that Vale Base Metals has had over the past while, there is significant potential for further expansion at Salobo.

And I think we will see a lot of that. I mean, many of the announcements on additional capital being put into the Carajás region and that Salobo will see benefits of that going forward. So for right now, we modeled it as reasonably flat but I think you could potentially see some upside as those capital investments come in.

Okay. So yes, so I mean you did about 270,000 ounces in 2024. So if I'm reading you correctly that you sort of think fairly static around that level, say, to sort of 2027, 2028 before maybe starting coming off a bit?

Yes. Yes, that's reasonable.

And then, yes, sorry, just following up on the conversation around expansion and obviously, the talk of potential fourth line there, do you continue to have those conversations? Has there been any sort of progress there in the last sort of 6 months that you can talk to?

It's still in study phase with Vale. I would say. I mean, we continue to be engaged on with them. That's really our most significant partner on all those discussions. But as they go through the studies, we'll continue to have those discussions with them.

The other thing, Will, that's notable is, they've been talking about it more and more publicly. The whole idea of Salobo [ 3.5 ] and adding another 6 million tonnes per annum capacity is something they're referencing often. But like West said, in the study phase, it is not in our profile at all. So that would all be upside to us.

And your next question comes from the line of Larry [indiscernible].

And congratulate on a successful career, Gary. I would like to circle back to talk a little bit about transactions. So Wheaton has a really strong focus in gold streaming transactions in the past. As you know, silver is also precious metal and silver is definitely in Wheaton's DNA. So I guess, long story short, with gold already reaching all-time highs, should we expect Wheaton taking advantage and be more active in the silver space?

Thanks for the question, Larry. I would love to find opportunities where we could add additional silver. Unfortunately, silver comes as a byproduct typically of polymetallic assets. So it's -- although the focus is precious metals, I wish we could say that we'd be -- we have a way of actually diving more into silver, into high-quality assets. I can tell you that when we look at these things, we look and transact in the current environment. It does not necessarily mean just because commodity prices have risen that we're paying spot prices on our precious metals streams, whether it be gold or silver. So we will always transact such that we're getting a solid return in the context of the environment that we're in.

Absolutely, that's fair. Next question kind of focuses a little bit on Blackwater, the recent amendment to the stream agreement. I'm just wondering how much of the expansion for Blackwater's been factored into a long-term guidance now that the silver streaming is based on the throughput?

Well, the reason we've done that whole transaction is to simplify the overall process. And at the same time, it accelerates the production of silver that we get in our portfolio. So you get a lot more silver upfront, you get a lot more capital upfront in a strong commodity price environment. But if you look at where we're actually headed with that asset, we're pretty optimistic that they're going to outperform what they're originally saying as well. So I'll leave it at that.

And Wes, do you want to add?

Yes and maybe just add that they are obviously continuing to look at the expansions there and what that looks like. I mean they're looking to move into those reasonably quickly. I think -- I mean it's -- and I think overall, what we've got modeled in our long term is the same thing that you would have seen publicly right now but there is a discussion on hoping to move these things forward sooner rather than later. It's definitely to the benefit of that asset to get those expansions in sooner.

Perfect. Sounds good. I have just one last question and focusing on the Voisey's Bay impairment that was mentioned in the press release. So I was just wondering how much of the impairment was a result of the weakening cobalt price versus a change in your production estimates or change in the discount rate that's been applied to the valuation process?

It's virtually all cobalt price.

From a production profile point, I mean, they announced that they're fully into the underground now and we're actually seeing that production side very positively at the moment.

Yes. Perfect. That's what I thought, too. So I was thinking it was slightly offset. And, of course, best wishes, Gary.

Thanks again, Larry.

And your next question comes from the line of Martin Pradier from Veritas.

I want a little bit more details on what you expect for 2025 and 2026 for Goose, Mineral Park, Blackwater and Platreef, in terms of production.

So in 2025, the 4 together, we would suggest 20,000 to 25,000 GEOs. So that's accounting for half year start up and, of course, a ramp-up after that. The following year, we wouldn't -- it won't be quite into full production in 2026. But mid-2026, we should be hitting our stride. I mean, a full year production at Blackwater is about 30,000 GEOs to our count. So we'll have about that in our 2026 profile.

Okay. And how big is Mineral Park in 2026?

About 10,000 to 12,000 GEOs would be a reasonable assumption.

And your next question comes from the line of Lord Ashbourne from Edison.

And I could pop in my congratulations as well on an excellent year and an excellent quarter. My best wishes to Gary, of course. I know that counterfactuals can be difficult but I was interested by your answer to the cobalt question. And I just wonder -- I'm sure you've seen the cobalt price in the last few days, which is suddenly 50% higher than it was a few days before that. And I wonder if the cobalt price on the 31st of December had been what it is today. Would you have impaired the asset?

Yes. It's always difficult to pick the price that you're going to be using and especially in these volatile times. I think the -- we view the -- we've been following the cobalt price and it's been depressed pretty consistently over the last 12 to 16 months. And I think the recent rally that we've seen is being driven by the [ DRC ] kind of stemming production. So we're just not sure that we can rely upon that to continue. That wasn't really your question. If the prices were to remain at these levels, would we have impaired it? Probably not. But I think it's unlikely that we'll be talking about impairments or impairment reversals on Voisey's moving forward. And we just wanted to take that noise out of the equation.

Thank you, everyone, for your time today. In closing, we're pleased to have reported a record-setting quarter to close 2024. Wheaton's high-quality, long-life portfolio of assets, sector-leading growth profile and commitment to sustainability provides our shareholders with a solid outlook for the future as one of the best vehicles for investing into the gold and precious metals space. I'm sincerely thankful to all of our stakeholders for being part of Wheaton's success and I look forward to another strong year ahead. I have never been more excited about the future of the company as I am today. Thank you.

Thank you. And this concludes today's call. Thank you for participating. You may all disconnect.