Good morning. My name is Katie, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Buenaventura Conference Call. All lines have been placed on mute to prevent any background noise. After the presentation, we will conduct a question and answer session. The instructions on how to ask a question will be given at that time. Thank you for your attention. I would now like to turn the call over to Rafael Borja of i-advize Corporate Communications. Sir, you may begin.

Thank you, Katie, and good morning, everyone. Welcome to Compania de Minas Buenaventura's Third Quarter 2015 Earnings Conference Call Please be advised today's call is for investors and analysts only. Therefore, questions from the media will not be taken. Joining us from Lima, Peru are Mr. Roque Benavides, Chairman and Chief Executive Officer, Mr. Carlo Galvez, Chief Financial Officer, and members of the company's management team. [Indiscernible] the press release is issued yesterday, Thursday, October 29. If you did not receive a copy, please contact i-advize in New York at 212-406-3693. Before we begin, I would like to remind you that during this call comments made by the management may include forward looking statements which are subject to various conditions and uncertainties based on a variety of factors. These forward looking statements may differ materially from actual results. That we ask that you refer to the disclaimer located in the earnings release prior to making any definite decision. And now it is my pleasure to turn the call over to Mr. Roque Benavides, Chairman and Chief Executive Officer of Buenaventura for his presentation. Mr. Benavides, please go ahead.

Thank you, and welcome to Buenaventura's Third Quarter Conference Call. In this quarter, EBITDA from our direct operations was $6.9 million, and adjusted with the associated company was $73.5 million. Total activity for production in the third quarter was 187,000 gold ounces and 5.8 million ounces of silver. At the Tambomayo Project, 100 percent of major equipment has been purchased, and operations are expected to start in the third quarter 2016. At the San Gabriel Project, the environmental impact assessment of the project's construction is expected to be approved in the first quarter of next year. During the third quarter 2015, El Brocal average ore treated reached 15,000 tons per day level. Full production capacity level of 18,000 tons per day will be reached in the first quarter 2015. Cerro Verde's planned expansion to 360,000 tons per day is in line with schedule and budget. Full plant capacity is expected to be reached in the first quarter of next year. In terms of our operating revenues during this quarter, net sales were $200 million a 35 percent decrease compared to the $306 million reported in the same quarter of 2014. This was mainly explained by a decrease in gold, silver and copper prices as well as lower gold and copper volumes sold. Royalty income decreased 9 percent to $8.7 million in this quarter, compared to $9.5 million in the same quarter of 2014. This was due to lower revenues at Yanacocha, 13% lower quarter to quarter. In terms of our production and operating costs in the third quarter of 2015 Buenaventura's gold equities production from direct operations decreased 16 percent from 108,000 ounces in the third quarter of 2014 to 91,000 ounces in this quarter due to the decline in production at the Breapampa mine that was expected. Gold production,…

Thank you, sir. At this time, we will open the floor for questions. [Operator Instructions]. Our first question comes from Carlos De Alba from Morgan Stanley.

Yes. Good morning, gentlemen. Thank you very much. So the first question is if you could help us understand the big difference that we saw between silver production of around 5.6 million ounces in the quarter and silver volumes vault of around 4.86 million ounces. And then the second question is if you can quantify, you know, how much the higher stripping ratio and particularly the pre-operational stripping of the Cienaga Norte peat in Tantahuatay. What was the impact that that had on cash? And if that will continue in the next few quarters. That's basically, that's the questions that I have right now.

Well, Carlos, it's Carlos Galvez. The difference the 1 million ounces that you mentioned between the silver production and silver contained salt is mainly due to a slight increase in different operations of the inventory. In the case of Uchucchacua, we increased our inventory by 700,000 [ph] ounces. In the case of Julcani, we increased 200,000 this is because the material salt in the case of Julcani is considered one this material which is through the smelter which is about the time that has taken to this content is just material in inventory. And in short increase in Brocal inventory used through the burning production of - the additional production of ore concentrate coming from the [indiscernible] that increased something else to 50,000 ounces. Generally in general terms, we have explains about 750,000 ounces. We have additional materials that come as a byproduct in other different operations, like the Tantahuatay, the [indiscernible] and others. In terms of the stripping ratio in Tantahuatay, it has to increase from about 0.07 to 0.26 even that the numbers. So this increase in the stripping ratio will remain for throughout this year and then the first quarter of next year.

Okay. Thank you. And just another one, if I may ask, looking at Appendix 5, the all are in sustaining cost. If I looked at the Buenaventura column and also the attributable production columns, they are the numbers for all-in sustaining costs are close to $1,200 per ounce. So basically it means that, at these levels, the company is just breaking even in gold operations. So what -- could you comment how do you see this situation and what are the plans that the company has to have issue that the cash generation on an all-in basis improves going forward.

Well, essentially in a very profound effort to reduce costs, and we are getting some important results. The fact that Orcopampa has reduced its costs, the fact that, that may be because of lower grades, La Chancas and Tantahuatay may have increased somewhat. But we expect that in this quarter, in the fourth quarter, costs in the La Chancas and Tantahuatay will also come down. So the thing that we -- we are confident that costs in all of our operations will come down and certainly will contribute to the overall profit of the company.

Just to add a little bit more flavor on this, what we have done in terms of costs in the operation is that we map the older elements that contribute to the costs. And then we've targeted the largest elements -- the largest contributors to cost, such as contractor charges and supplies, for example. And we are renegotiating some of our -- with our some of our suppliers. And we are also working on productivity programs in every mine. So every mine has a program to improve productivity. If you review the cost data for this quarter in all the underground mines that has been the trend. So we expect that this will continue going forward.

Thank you. Next question comes from [indiscernible] from Credit Suisse.

And could you elaborate a bit more on how will Uchucchacua vertical expansion impact overall cost? And also a second question. If you could provide guidance on Cerro Verde's production for the remaining of 2015 and for 2016 and also how will the expansion impact cash costs? Thank you.

Well, in the case of the Uchucchacua -- well, it's not actually an expansion. We are just to complete each month some additional opportunities to meet -- to increase the [indiscernible] per month -- much of the 100 tonnes through 2018, 100 tonnes [indiscernible]. But this what it means to dilute sort of fixed costs and, on the other hand, we are going to improve the methodological postures in order for instance to reduce the sanitation [ph] of certain material that will permit us to reduce the un-sustaining costs due to the expansion of special [indiscernible] facilities. On the case of EL Brocal, for sure. Achieving the target of for the region 18,000 tons in three months will permit to reach these lower cash costs for our operations. Gonzales that he is over here could expand on that, because he has full details. I don't know if Gonzales, you can...

Yes. We are working on reducing costs. That's a major issue for us. And we seek to have a reduction of at least 5% to 7% of our total costs. So how we are going to do that? We are renegotiating with our contractors. We are also reducing the costs of regions, of -- in quantity and in prices. And we are also working on having better recovery by including some additional modifications to our project. And we are also working on improving our production by including two cone crushers. These cone crushers are going to be installed in parallel to the one that we have right now. And that project will be ready by January. With that project, what we expect is to increase the production and the recovery by decreasing the [indiscernible] size.

Regarding the Cerro Verde's performance and production with -- well, they are progressing well with the first step. They have already reached initially up to 100,000 tons per day to put from the new facility. And they are going to progress its worth to mention. In this regard, they have [indiscernible] they have added certain additional production that has needed [ph] to reduce the cash cost during September, for instance, at a level of $1.47, which was lower than what it has been during the past. So, $1.49, sorry per pound. And in terms of focus, we expect to achieve these lower continue [indiscernible] and within lower cash costs in the future to the extent that we reach the total capacity. Importantly, we mention that the reduction in the contribution expected on the profits from Cerro Verdes is due to the fact that they began to depreciate the new facility in September and due to this depreciation during one month September was close to $18 million, as compared with a traditional $11 million they got. So this is something that we expect has a positive result.

Do you expect that production as of the end of the year?

Well, it is difficult to mention because these [indiscernible] ramp up --.

The accumulated production is -- I would like to comment on the - for example, on the material mines, they are on target right around about 700,000 tons per day. On the accumulated production, they are also on target -- the final figure for the year should be around between 450,000 and 550,000 tons. So they are on target again there and also on the [indiscernible].

Yes. Well, the thing is the projection should be in the order of 280,000 tons of copper, that's the budget.

Thank you. Your next question comes from Karel Luketic from Bank of America.

Hi. Good morning, Roque and everyone. Thank you for the questions. I have two questions. The first one is a follow-up of the question you were just answering. Just to confirm, this year we're talking about 280,000 tons potentially from Cerro Verdes. And looking at 2016, if I'm not mistaken I heard 450 to 550, right?

No, no. It's in the order of 600,000 tons of copper. That was this year's projection. Sorry, sorry let's clarify it. 280,000 tons of copper will be produced this year. Next year will be duplicating - or in excess of duplicating the production. We expect to reach 600,000 tons of copper next year. That's the figure.

That's clear. Perfect. And my second question, actually, its two questions tied to the same one. Looking at the Yanacocha here, what is the outlook in terms of -- I know you still haven't provided official guidance for next year. But what can we expect in terms of [indiscernible] volumes are a bit more broadened, and the same looking at cost? And my second question, maybe tied to Yanacocha or not, is there any sort of M&A that you are considering today? Not only in the Yanacocha, renegotiating your stake or something of this sort or even outside of the Yanacocha, is there any other option that we're analyzing? Those are my questions. Thank you.

Well, the Yanacocha will produce similar to this year for next year. But it will depend on the expirations. We don't have a specific figure at this point in time. In terms of M&A, we essentially have nothing to comment on that respect. We don't have any specific information to give at this point in time.

Thank you. Your next question comes from John Bridges of JP Morgan.

Good morning, Roque, Carlos, Igor. Congratulations on the cost control progress that [indiscernible]. I was just wondering. You mentioned the higher DD&A at Cerro Verdes. And there's an accumulated spend of $4 billion, I understand was covered by project debt, I'm just wondering if that was being capitalized up until now and maybe the interest charge on that is going to start showing up in the accounts next year. I just wondered if you had any idea on, what we should keep in -- take into account over and above the $1.50 per pound for a cash cost in order to get to the likely contribution to your numbers beginning next year. Thank you.

The thing is that what Cerro Verdes has is a $1.8 billion facility, which has been taken and has been invested. I don't know would you specify your question, please? I don't know if I got it.

I was just wondering, will there be an interest charge which was perhaps, capitalized up until now which will show up in their income statement?

No. They have been considering the financial expenses, the P&L, they have capitalized only during the construction. But from now on, they are going to spend what is going to [indiscernible] to deter quarterly in terms of financial costs.

So was that included in the Q3 results with the higher DD&A or [indiscernible] in Q4?

No. They are going to begin in the fourth quarter. They began only to charge depreciation and amortization due to the way to declare and to calculate assets per units produced. So when they began to use the new facilities, they began to depreciate that.

Do you happen to know what the interest rate is on that? Maybe we can discuss afterwards?

No. The interest rate is reliable to us, 1.9 percent.

Thank you. Our next question comes from Patrick Chidley from HSBC.

Just well done on the cost control on some of the assets there and I think it's great that you've been able to renegotiate some of those contractors down, and I think it's showed in some of the mines there. But one where obviously it doesn't seem to be the case is Brocal. And I was just wondering is there any way you can get these commercial deductions down? They seem to be extremely high and a big portion of actual revenue? Thanks.

Well, you can make that the commercial deductions in the case of copper have to do with the arsenic [ph] content of the concentrate. But the effort that Gonzales Ayerre and his team is doing in Brocal is essentially concentrated in renegotiating with contractors, and as he mentioned, reducing the consumption of some [indiscernible]. And they are doing an effort. In the middle of around [indiscernible] that have been quite difficult but that we are getting there. And we have confidence that we will improve the results of Brocal going forward.

Sorry. But perhaps something that is really important to clarify. When we mentioned the average realized copper price of Brocal, what we are talking -- what we are talking is not necessarily regarding to the drilling charges that Roque mentioned but specifically is the impact of the final price we obtained and we charge to the current price due to the QP ph. In the case of our sales in Brocal, that is the QP has a difference of six months in some deliveries and up to eight months in some certain deliveries. And this negative impact due to the drop of prices impacted the current price. So this is something that shouldn't be repeated towards the future. But if we keep flat, we are going to continue reporting the provision of prices.

Yes, $3,700 a ton. That was actually provisional pricing impact. And that's not to be continued. So you will get more revenue per ton for your copper, you think, if it's a fairly flat pricing environment.

[Indiscernible]

[Operator Instructions] Our next question comes from Tanya Jakusconek from Scotiabank.

I have two questions, and one's a technical one and one's just on the finances. Maybe on the technical one, just on Tambomayo. I think on the last conference call, we talked about the CapEx and the $250 million range. And now it's 290 to 340. Maybe someone can explain to me, like, what has happened to have that increase in the CapEx?

What happened is that the CapEx mentioned over here is a 100% CapEx, the total CapEx of the project. What we have [indiscernible] is to round at 125. We have already progressed, and -- but the figure is not the number that we have to disburse. We have already disbursed in excess of 50% of that.

Tanya, the CapEx includes mine development also. So we have completed about 98% of the detailed engineering for the project. And we have, as Roque mentioned, purchased 100% of major equipments. And what we are doing -- we are finalizing now all the bulk [indiscernible] and beginning the concrete -- some of the foundations for the equipment as we speak. And we are also mobilizing some of the structural steel. So the project is moving along quite well and -- but, yes. Our capital figure includes the mine development cost.

So the number given of 250 million last quarter did not include the mine development cost?

Yes. It did.

I'm just trying to reconcile the 250 million that was given to us last quarter and the 290 to 340 is one without mine development and this one now is with?

No, no. The question is that when we mentioned this with development cost and the building of the project. But this cost of between 290 to 300, so it includes the full exploration, the full cost of the budget since the beginning. There has been 350 is without considering the time cost of this project.

So the 250 million you gave us last quarter was -- is less to be spent?

Last we have the development and construction that we had to sign up for exploring and putting this project in... [Multiple speakers].

But we have already invested in the project close to $100 million, so what is left to invest is more in the order of $150 million to $160 million.

Okay, all right. And then maybe if you can just -- I wanted to ask about the grant the loan of $21 million that was done, what exactly was that?

Which loans, please?

That you granted a loan of $21 million, was in your press release.

Well, the loan that we have granted to Cerro Verdes that the main shareholders of Cerro Verdes committed to grant some loans in subordinated loans, if there were certain limits on the covenants of these financial facilities. Cerro Verdes has already received 1.6 billion out of the 1.8 billion committed and its [indiscernible] to continue receiving additional $200 million to complete the project. However, temporarily due to the EBITDA generated, there was a constraint in the relationship that EBITDA generated and due to lease and not to break these covenants, we were requested we will cost our deeps as [indiscernible].

Thank you. [Operator instructions]. I am showing no further questions. I would now like to turn the call over to Mr. Benavides for closing remarks.

Well, thank you again for attending this conference call. This has been a quarter where we have shown essentially cost reductions, the effort that the organization has been doing in targeting these reductions in cost. We certainly have been working very hard on El Brocal and we do expect results from now on. In Cerro Verdes production with lower copper pricing was impacted relatively, but the expansion is under way. And we are very pleased to say that it's on budget and on time and it will certainly contribute to the overall revenues of Bonaventura. With that, I thank you for attending this conference and hope to see you soon. Thank you, and good morning.

Thank you, ladies and gentlemen. This concludes today's conference. You may now disconnect.