Aura Minerals Inc

TSX:ORA

Earnings Call Transcript 2024-Q3

[Operator]

Good morning, ladies and gentlemen. Welcome to Third Quarter 2024 Earnings Call. This conference is being recorded, and a replay will be available at the company's website at auraminerals.com/investidores/. The presentation will also be available for download. This call is also available in Portuguese. To access, you can press the globe icon on the lower right side of your Zoom screen and then choose to enter the Portuguese Room. After that, select Mute Original Audio. [Foreign Language]

[Operator Instructions] Before proceeding, we would like to clarify that any statements that may be made during this conference call regarding the company's business prospects, operational and financial projections, and goals are the beliefs and assumptions of Aura Executive Board and the current information available to the company. These statements may involve risks and uncertainties as they relate to future events and therefore, depend on circumstances that may or may not occur. Investors should be aware of events related to the macroeconomic scenario, the industry and other factors that could cause results to differ materially from those expressed in the respective forward-looking statements.

Present at this conference, we have Rodrigo Barbosa, President and CEO; and Kleber Cardoso, the CFO.

Now I'll turn the conference over to Rodrigo Barbosa. You may begin your conference.

[Rodrigo Barbosa, executive]

Thank you very much, and good morning for all. It's a pleasure to be here again to talk about Q3 results. And as we will go through the presentation, all of us, we are super proud to share with the market the stronger results that's coming with higher production, lower cost and higher gold prices. And as we will see throughout the presentation, for 2025, there's another project coming online that we will be able to continue to grow and deliver on stronger results along the next quarters.

So as we already disclosed with the market a couple of weeks ago, we -- during the Q3, we produced [ 68.2 ] gold equivalent ounces when added to the other quarters in the last 12 months, record high production of 270,000 gold equivalent ounces in production on a yearly basis. This is on quarter 10% increase on Q3 compared to Q3 2023.

And as we've been disclosing with the market, we would see this increase along the year, first, because we have fixed and increased production in Honduras that went through a challenging year last year. And on the top of that, also Almas coming online and also reaching a full production after the transition of the contractor. So when you add the stronger production for Honduras and then also Almas with a stable production in Aranzazu, despite some lower production in Apoena, we are reaching record high production.

At the same time, we are very glad that we could manage. And as I was mentioning, managing the cost is our focus. Almas has a lower cash cost compared to the average that we have. So Almas coming online also can contribute to a lower all-in sustaining cash cost. So the combination of higher production, higher gold prices and lower cost came to a record high EBITDA of $78 million. This is close to 40% above the previous quarter. And understanding that during the Q3, the average gold prices was $2,500, while today is above $2,700.

Of course, during Q4, there will be some impact on the cash generation due to the colors that Kleber is going to present. But on EBITDA, this is going to be stronger and also there are some ounces that are not hedged that will benefit from a strong gold prices during Q4. And then during next year, we will also have some hedges, but that is less than 20% of the production. So also benefited from a higher gold price.

Through this record high EBITDA of $78 million, that was translated to $65 million on free cash flow to firm. Out of this $65 million, we invested $54 million. That means that we've been able to grow within our own cash flow from the operations. And despite investing in Borborema and in other projects for growth, we've been able also to reduce the net debt to EBITDA, which give us a very strong position to start production on Borborema next year already with under lower leverage that will contribute to a higher production and cash flows from operations.

Borborema, that was mentioned, is already above 54% of construction completed, on time, on budget to start the ramp-up during Q1 next year and then commercial production second semester next year, very much in line with our projections and now entering the very fast speed that we will disburse in advance the project so that we can start the ramp up in Q1 next year.

Kleber is going to also mention to you, if in one hand, we have a very strong and it's a very good sign that gold price has been appreciated significantly until the end of Q3, although we continue to appreciate the stronger cash flow comes from this gold price. But also there is some adjustment account -- I mean noncash adjustment that we need to do to market to market the options that Kleber will also provide you more detail.

So very strong Q3, and we should see Q4 continue to increase in terms of results. And then next year, Borborema online also adding more ounces and more EBITDA and more cash flows. That's important, that the strong results that we continue to move up even after our Q3 closed, assessing capital markets -- on the debt capital markets, we just announced BRL 1 billion that was initially forecast to be BRL 0.5 billion. We increased due to the significant demand to BRL 1 billion, and also could reduce the cost. That shows how strong Aura has capillarity and can access a good source of capital when it's necessary.

On the top of that, we also announced an acquisition that we entered in the process of acquisition of one project in Guatemala that has world-class deposits that will take a few years for us to be able to get approvals and licensing fully so that we can start investing. But we are very confident we will be able to do so. And after closing, we will also dive in the project, so then disclose more information about our strategy with the project.

Also recently, yesterday, we announced a change in dividend policy, which we will now pay on a quarterly basis. We were paying biannually. Now we're going to pay on a quarterly basis, reminding the investors that our policy is 20% of the EBITDA minus recurring CapEx, not including the expansion CapEx. But as you can notice, during the last few years, we've been paying above the minimum -- above the guidance that we gave. And now we also declared more dividends yesterday, which provide our investors annualized yield of 9.3% return on dividends and share buyback.

So that Aura -- if you see the other years, we also provided a return to our shareholders in 2022 by 6%, same thing in 2023 and '21, 13%, and now 9.3% on the top of our growth. So we've been able to do what we disclosed to the market during our IPO in Brazil. We had a project to grow, to invest in greenfield projects while we pay dividends and including also M&A. Since then, we acquired Borborema. We are now on the process of acquisition also of Bluestone and investing in Almas and now paying the dividends, and maintaining and also reducing our net debt to EBITDA. That is a very strong signals that Aura has a very strong cash flow coming from the operations, although we will continue to increase along the next year with the development of Borborema, Matupa and hopefully Cerro Blanco in Borborema.

So next slide. As we always disclose, safety is the most important value that we have, and we monitor all the operations on the hourly basis and daily basis. That quarter, we had 0 lost time incident. Now we are at Aranzazu 24 months, Minosa 23 months and Almas 26 months without any lost time incident. Apoena, we had, unfortunately, a minor lost time incident during Q2. But if for not that, we also would be around 24 months in Apoena without lost time incident.

We also have a third-party consultancy that monitor together -- we have our own team, but also a consultant external party to monitor all the geotechnical structures. And they also always issue a report about the stability of the structures. And we finished the quarter with all the geotechnical structures under satisfactory conditions.

So when we look at the production on the left chart on the line above the bars, as I was mentioning, since last year, we would see a gradual increase in the last 12-month production. And now we see that we had an increase in Q3 2023, Q4 '23, Q1, Q2 and Q3 '24. This is the fifth quarter in a row that we've been increasing the last 12 months of production, and that comes from the challenge that had been addressed in Honduras and also now the production coming in full in Almas.

When you move to the right side on the bars, we saw Aranzazu that had a minor decrease in gold equivalent ounces that is because as we convert the production and the revenues in copper by gold equivalent, we divide it by the price of gold. Gold price has appreciated more than copper price. So that means that it's less gold equivalent ounces produced, although in terms of amount of copper, it would have increased -- it increased by 8%. Production [indiscernible] has been very stable and very much in line with our mine plan.

Apoena, this is where we had a reduction in production, very much triggered by a delay in some access that we would have to mine in Nosde. So we had to switch to other areas that had a lower grade and also lower recovery, but we should be entering that area very soon in the next quarter or next year. But we also should see an increase in production in Q4 compared to Q3 in Apoena, although not significant.

In Minosa, again, we continue to do improvements on the operations, either stocking or also on the recoveries. But also we had a favorable weather with less than average rain that allowed us to produce from 19,000 ounces to 21,000 ounces during the quarter, which was very strong and also helped us to reduce the cost.

Almas, as we were disclosing to the market, Q2, we had a unique quarter. Once we had a transition in the contractor, we lost production mainly in April and May. And as we showed and disclosed with the market in June, we were already producing close to 5,000 ounces per month. And we had realized and we understood that now we were on track to meet a strong production in Q3 and then also in Q4. So now we are delivering this 15,000 ounces during the quarter, which is on average, 5,000, which is the capacity for Almas during this year. So very strong, not only with the production, but also now stabilizing the costs. So that also helped us on Almas to bring the average slightly down.

So as I mentioned, in terms of cash cost, very important, while the industry has been increasing in all-in sustaining cash costs due to very different factors, including inflation along the last 4, 5 quarters, Aura, we've been able to manage very closely on the hourly basis, on the daily basis, our cost. So we've been seeing on Q4 last year, Q1, Q2, Q3, a very stable trend with a slight decrease now during Q3. And we should continue to see this stability in terms of cash cost for Q4 during this year.

Next slide. So in terms of the guidance, we maintained the guidance that we initially projected to the market. We are now at 201,000 ounces of production. When you project us to the end of Q4, we should be very much in line with the guidance between 244,000 and 292,000, perhaps in the middle or slightly above with a constant prices where we -- when we projected this to be above the average of the guidance in terms of production, reflecting strong production that's coming from operations despite some weaker production in Apoena.

In terms of cash cost, we also could provide in the market on Q3 year-to-date cash cost now at $1,022. It would have been below $1,000 if we had the prices that we projected. The influence here of the gold prices is when you convert copper to gold, it's less gold equivalent, so you divide the cost by less production so that increase a little bit the cash cost. So that's why we provide the investors and the analysts the 2 references. But despite higher cash costs, because of higher gold prices, which is a good news, we've been able to manage and we are now very much in line with the lower level of the guidance we gave to the market. That also was reflected to all-in sustaining cash cost. That is now at $1,300, would be below $1,300 at the constant prices, which is very much with the bottom range of 2024 guidance. And we see no reason for that trend to change during Q4.

In terms of CapEx, we now have $114 million until September, projecting -- the guidance for the market is $188 million to $219 million, understanding that now this Borborema just entered the phase of high expenses and high speed of construction. So we maintain the guidance to the market also for the year-end in terms of CapEx. And Borborema, very much in line with the schedule and also with the budget.

Talking about Borborema, that's the picture on the left, things are now coming together. We are -- as you see in the picture, we build the parts around the main plant. And then once those parts are -- get ready, we assemble them. And now we are just entering the phase of assembling all the parts into the main plant, and this picture should evolve significantly along the next couple of weeks.

Again, we always like to highlight the importance and the relevance of this project within our portfolio. This is a project that was initially projected with 812,000 ounces. Although we have 2 million ounces of resources, we utilize only 812,000 ounces as a reserve because of restriction of one area that we would only access if a road would be moved. We -- only with this 812,000 ounces of reserves, this project at the gold price of $2,600 is already generating an NPV close to $540 million and also internal rate of return above 81%, understanding that this project after we can license to move the road, the reserves can more than double, and then we also access a significantly higher NPV.

And this NPV was calculated without the impact of the collars that we did for the first 3 years, even -- to understand how relevant it is or not so significant is the impact of the collars. If we were to deduct the price of the collars at the strike price during the first 3 years, which is 80% of the production that we did -- the hedges, it would deduct from the NPV around $30 million out of the $537 million. So that was guarantee the payback without harming the total value of the project on the long term.

Kleber, now I turn the floor to you to present the results, and then we come back with questions and answers after that.

[João Cardoso, executive]

Okay. Thank you, Rodrigo. Good morning, everyone. So on this page, as usual, we start with a summary of the main financial KPIs for this quarter, the last few quarters. And on this dotted line, we bring the accumulated number for the last 12 months. Pretty much consistent with Rodrigo explained, this was a quarter of many record highs in terms of operational results. Our revenues reached $156 million on this quarter and our net revenues now taking last 12 months is already at $547 million at the end of this quarter.

When we look at adjusted EBITDA, as Rodrigo was -- showed, our EBITDA increased significantly on this quarter to $78 million, coming from $56 million on the previous quarter. And when we look at the dotted line, we see a trend also in the last 5 quarters of increasing our trailing last 12 months EBITDA with a big acceleration now on Q3 '24, reaching $228 million. And if the gold prices stay where they are, we should see another acceleration on Q4 as well.

When we look at net income, we reported a net loss of $12 million on this quarter that is once again similar to what happened in the last few quarters related to the noncash losses to date related to the gold net hedges market to market. We see that has happened and I want to have one page to explain in more detail, this has happened since the fourth quarter of 2023. And if we exclude this impact of the market-to-market losses on this quarter, our net income, which is the adjusted net income that we highlight at the bottom would have been positive at $43 million, much more consistent with the operational results.

And then on the bottom right side of the page, we see the progression of our cash and net debt. We see on this third quarter, both the cash and net debt consistent with the previous quarter. We ended the quarter with $196 million in cash. Not including yet the proceeds from the debenture that we issued in October at Almas, BRL 1 billion, about USD 175 million. So in October, our cash position increased significantly from this $196 million.

Our net debt remained stable at $144 million, which is very positive considering Q3 was the quarter that to date we invest the most in the CapEx for the Borborema project. And in the same direction, very positive, we see the reduction in our net debt over the last 12 months EBITDA ratio coming from 0.8 in the last quarter to 0.6 now.

Now understanding the main items between our adjusted EBITDA and net income for the quarter. We see out of the $78 million EBITDA that we reported, 3 business units reported very strong numbers; Minosa reported $27 million EBITDA; Aranzazu $24 million; and Almas $23 million, so very strong. Apoena, despite a weaker quarter with production, also reported a $10 million EBITDA.

Then amortization and depletion expenses of $17 million came above what we saw in the last few quarters. That's mainly because of those increase in production, we're recognizing more depreciation in our results. And then one of the biggest items for the quarter was the financial expenses that we had an expense of $63 million in the quarter. Most of that related again to the market-to-market losses related to the derivatives, which were close to $57 million this quarter, higher impact than previous quarters, which I'm going to go next page in more details.

The income tax expenses at $10 million according to our expectation, bringing the quarter to a net loss of $12 million. But then we bring back the market-to-market impact, we see that we would have ended the quarter with adjusted net positive of $43 million.

Then on this page, we bring an analysis to help us understand the accounting impact of the market-to-market, especially this quarter, but also the previous quarters and the relationship of these accounting losses with the increase in gold prices. Here on the right side of the page, we bring the closing gold prices at the end of each quarter. We see that fortunately, the gold price has been increasing consistently over the last 4 quarters with the biggest increase being on this last quarter, Q3 2024, where gold prices increased by $330 per ounce.

Then on the right side, we see there is a correlation between our market-to-market liability and increase in liability with such increase in gold prices. We see in quarters where the gold price is increasing more, the liability and therefore, the market-to-market loss increasing more in other quarters increase -- gold price increase less and the provision also increase less. And the biggest increase in the market-to-market liability and market-to-market loss was also in this last quarter, consistent with the biggest increase in gold prices.

And then on this page, we try to shift from an accounting view more to, I would say, an economic view, what is expected to be the cash impact in our future cash flows of our gold derivatives. Currently, we have about 290,000 ounces of outstanding gold collars with expiry dates ranging between now Q4 2024 and the year of 2028. We see on this quarter, we have about 40,500 ounces of gold collars expiring. And then when we see from 2025 to 2028, most outstanding gold collars are related to the Borborema hedging program.

As a reminder, when we announced the construction of Borborema, we also announced that we were entering a hedging program to hedge the first 3 years of production -- 80% of the first 3 years of production on the Borborema project through gold collars that receives what's most outstanding here.

On the bottom of the page, we bring what's the average price of these outstanding call options per period. We see on average, it's $2,500, which at current spot prices or if gold continue going up. These collars are eating the money in favor of the banks against Aura. But we also bring a reference what could be our future production, especially when Borborema comes online to show that these outstanding derivatives are a small portion of our expected future production.

We have a dotted line with the 353,000 ounces of gold equivalent. This is not a projection or guidance. This is more Borborema pro forma number, which is taking our last 12 months production and adding what is the average yearly production for Borborema since most of these outstanding gold collars are related to Borborema. So we see depending on the year between 20% and 25% of our production between '25 and '27 will be hedged, which means 20% to 25% of our production and cash inflows would be capped at $2,400, which means that the majority of our production, 75%, depending on the year, 80% would be exposed to gold prices. That's why continued increase in gold prices should be a disproportion of positive impact yet in our future cash flows as that [indiscernible] of our future -- expected future production.

Now shifting to a view on the change in our cash and cash equivalents throughout the third quarter. We see we started the quarter with $192 million in cash and equivalents. Then on this left side of the page is what we call the adjusted free cash flow to firm, which is the free cash flow to firm generated by the 4 mines in production, not including investment in expansions.

We see that portion of the business generate strong cash flow of $65 million in the quarter, was also record high in the history of the company, which was more than enough to pay for all the investment for growth in the quarter, that was $54 million, of which about almost $40 million was related to the CapEx of the Borborema project. So very positive what we generated in the quarter, more than paid for the cash expenses, mainly the Borborema project construction in the quarter.

And here to the right side of the page, the financial items, highlighting that we invested $6 million to do share buybacks.

And here is the same analysis looking for the year, the first 9 months. So similar conclusions, the cash flows generated by the mines in production were $113 million. That was more than enough to pay itself for the investment for growth in the same period, that was $95 million.

And then to the right side, I would highlight the dividends and share repurchase. We're returning $35 million to shareholders in the first 9 months, not including yet the dividend that we just announced yesterday and bringing the cash flow close to $200 million.

And then, with this, we end the presentation and open to questions.

[Operator]

[Operator Instruction] Our first question comes from Guilherme Nippes with XP.

[Guilherme Nippes, analyst]

Congratulations on the great results. I have 2 questions here on our side. My first one is if you could provide us with an update on how you plan to prioritize the projects currently in your pipeline, given that you have now the acquisition of Bluestone and also considering that you have the other projects like Matupa, Altamira and Serra da Estrela?

And my second question is on Almas. And considering that you have the contractor transition, can we see any potential upside from here in terms of production and cost for Q4? I know that the production increased almost 40% this quarter and cost declined by over 20%. But just to make sure that this is the normalized level for Almas as well and if you could see any potential upside looking further. These are my 2 questions.

[Rodrigo Barbosa, executive]

Sure. Thank you, Guilherme. So in terms of the sequence of the project, for sure, our main priority today is to finish construction of Borborema on time, on budget, while we are now aggregating and doing exploration investments in Matupa, particularly in Pezao, right, so that we can aggregate it to Matupa along next year and our objective to start the construction hopefully until the end of next year, that depending on the results of exploration that we might have through Pezao and also Pe Quente.

That is then [indiscernible] schedule. Bluestone yet is a transaction that needs to be closed in January. And after that, we will be able to provide more information. Although we expect a few years to -- although the project is fully advanced in terms of exploration and also engineering, we understand that it might take time to do -- to get full support from central government and local authorities, including the socializing. So that might take a few years. And of course, if those conversations go faster than expected, then we could reshuffle and prioritize. But yet, Matupa is our main.

We continue to do -- we renewed the option in Serra da Estrela. So we continue to do exploration. We've been -- of course, if we renew the options because we saw a very interesting potential, which we are now at the dry season, doing more drilling. We plan to disclose more information on the results along next year. We've been very optimistic that this can be very interesting for Aura, but that will take yet additional 2 or 3 years of explorations until we have a pre-feasibility study or the feasibility study. So we still have some time of drilling.

In terms of Almas, as you could see, we had a big jump from transitioning last quarter, Q2 to Q3. Though we are working in more improvements, expanding the plant and so on, that would be now more gradual. You should not expect to have a higher jump in Almas, but low and constant improvements now on the day-to-day that we are doing, but not a big step such as we had from Q2 to Q3.

[Operator]

Our next question comes from Ricardo Monegaglia with Safra.

[Ricardo Monegaglia Neto, analyst]

Can you hear me well?

[Rodrigo Barbosa, executive]

Sure.

[Ricardo Monegaglia Neto, analyst]

First of all, congrats on the results. It was good to see the continuity of this growing trend. And as you said, you expect another sequential growth in 4Q. But just to understand, during last quarter's conference call, you mentioned that production could reach -- the quarterly production could reach a level above 70,000 ounces. Your production in Q3 was closed and maybe Apoena was the key issue for not reaching that target.

So if you could remind us what are the main challenges for production in this operation? And maybe if you could let us know what could we expect for a normalized quarterly or annual production level in this operation of Apoena, this would be interesting.

And the other question, as everyone knows, gold price has been an amazing run over the past year. So I just wanted to see what is the outlook for gold prices in your view? And do you think that a Trump or Harris administration will have an impact on that?

[Rodrigo Barbosa, executive]

Thank you, Ricardo. Just going back to the first question was about production levels on Q3, you mentioned 70,000. If -- for the good news, the gold price has increased, but that also impacted the gold equivalent production. As I mentioned, if it were not that, we would have been above 70,000 production in the quarter and again above 70,000 during Q4. But the gold price increases, so the gold equivalent translates to a lower volume. So for a very good reason, we did not reach the 70,000. And hopefully, gold price continue to increase, and we have this challenge for Q4 during this year.

Apoena, it's -- we will -- we're not providing yet the 2025 projections to the market. We should see an increased production during Q4 this year, yet it's a mine that even next year, we will have time to develop more, open more of the mine. The exploration results has been very interesting. So we might have to invest more to open and have a very interesting years after we have all this preparation done. So Apoena, I would say that we will have a minor improvement during Q4, but we should not expect a major also change during the next quarter.

Last question you mentioned was about gold prices. I think gold price has been surprising the market with constant increase independently from the elections. I think what the market says is that either Trump or Kamala, they are not focusing -- they haven't disclosed much what they will do to control the fiscal deficit. So in that direction, I think either one, we continue to not have a fiscal discipline, and that is favorable for gold prices as well.

[Operator]

Next question from Edgard Pinto with Itau BBA.

[Edgard Pinto de Souza, analyst]

Congrats for the results. Another quarter with improvements in operating rates. So I have 2 questions. The first one is a follow-up on Ricardo's questions on EPP. We know that you have a very complex operation there with several mines. So my points here are -- the first one, for how long do you expect to operate at Nosde? And looking to the medium to long term, which are your plans there? You had those studies about that super pit. Do you even consider going underground there? How do you think about this operation in the medium to long term to have lower volatility to results?

And then my second question and also a very specific one on San Andres, we saw that production has improved significantly over the past few quarters, but with a very different profile from what you had before. Your grades remain relatively low compared to 2021 and 2022. And also your recovery rates remain well below what you had in those previous years. But your plant feed has increased significantly. So your production at the end remains very solid.

So can you please explain what is behind this lower recovery rates now close to 62% to 65%? And if this new profile for operations, let's call it this way, with higher plant feed and lower grades and recovery rates is what we need to expect going forward? Do you -- can you operate with this higher plant feed? Do you have any bottlenecks regarding plant feed? Maybe not because you have a deep leaching operation there, but if you could give more color here, it would be great.

[Rodrigo Barbosa, executive]

Thank you, Edgard. So first, in Apoena, yes, I think the mine is moving us to have a bigger open pit. We don't feel it's going to be underground. But all the information that we'll be receiving on exploration shows a path to a bigger pit along the medium term. I believe it's going to be volatile for the next quarters up to the end of 2025. And then after that, we start to open up all the mine, and then that will create more stability in terms of production.

On Honduras -- on the other hand, of course, the other operations in Almas is very stable and with the gradual improvement in next year also comes online Borborema. And Honduras, we -- that change comes from the change in ore body. As I mentioned, the nature is not equal everywhere. So it has some changes. We enter now in the lower grades. That -- we should see this now stabilize at this level of grades. We don't see going back to higher grades that we saw 4 years ago. And when you have lower grades, also the recovery is lower, right? It goes a little bit together. Although we feel that the team has been working significantly to increase recoveries, I think we can achieve above 65% with the improvements that we are doing.

In terms of piling, there is a bottleneck. I think we are very much at the bottleneck right now. I think there's not much what we could do to improve production. On the other hand, there's always alternatives and initiatives for us to keep the eye on the cost and see if we can gain productivity and reduce the cost.

[Edgard Pinto de Souza, analyst]

Great. Great. And if I may, just a follow-up on the first question as well. It has been only 1 week since the announcement of the deal with Bluestone. Have you had the chance to talk with the local government? What was the reaction there or still early to say here?

[Rodrigo Barbosa, executive]

It's early to say, yet we entered in the process of acquisition. We are not the owner of the asset. So we can -- and we should only contact the government after the closing. So that will go through January.

[Operator]

The question-and-answer session is over. We would like to hand the floor back to Mr. Rodrigo Barbosa for the company's final remarks.

[Rodrigo Barbosa, executive]

Well, so I would like to thank everybody. I think it was a very strong quarter as we could show. I think as important as the strong results is to see what Aura has been able to achieve along the last years and project what is coming for the next year.

So [ I will quick remind ] our investors, we did our dual listing in Brazil when we did the re-IPO of the company with a project to come from 200,000 ounces to 400,000 ounces, developing Almas and Matupa. And our strategy was also to unlock value through exploration and also through M&A since -- while we would pay dividends with the market. Since then, we paid 13.5% of dividend yield in '21, 6% in '22, 6% in '23, and then in the last 12 months, now reaching 9% of dividend.

In the meanwhile, we also acquired Borborema. We built Almas. Now we are building Borborema. We acquired Serra da Estrela. We are doing exploration. We more -- we are increasing our resource and reserves as we are moving to higher production and recently also entered in the process of acquisition of Bluestone. So we've been able to diligently deliver to the market the big picture, which is to grow, to unlock value through also execution of the greenfield project, Almas online, on time, on budget and now at full production at a lower -- at the cash cost that we're projecting.

Borborema, more than half of construction done, coming -- the ramp-up on time, on budget, expected through the first quarter next year and commercial production along the next semester. We also recently announced Bluestone, which a project that we'll see when we would be able to build, but that's a world-class asset that would add significant ounces to our production with a lower cash cost as well.

All of this while we're also doing exploration moving forward with Matupa, we now acquired Pezao -- [ option ] to Pezao and Pe Quente. Serra da Estrela also moving forward. Hopefully, we can translate this exploration program into a PEA or pre-feasibility study in the next 3 to 4 years. So we are very much on track to reach the 450,000 ounces of gold equivalent within the project that we already have or even surpass this if we succeed with Bluestone and develop it in the next couple of years.

So I would like to thank all for participating in this call. Very strong results, very strong quarter during Q3 with gold price of $2,500. The gold price today is at 27 -- above $2,700, and that will continue to push our results higher. Costs are under control.

And next year, remembering and reminding that enter a major mine for us, which produce close to 85,000 ounces of production on a yearly basis with a lower cash cost compared to what we have today. So we will be able to continue to increase production while we can also reduce the cost and now with a very favorable gold price. So I think we've been very strong in delivering results, not only the results, but also the strategic project levels and then unlocking value to our shareholders.

So thank you for participating.

[Operator]

Aura's conference is now closed. We thank you for your participation and wish you a nice day.