Welcome to the Gran Colombia Gold Second Quarter 2019 Results Webcast. My name is Paulette, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] Please note that this conference is being recorded. I would now turn the call over to Mike Davies, Chief Financial Officer. You may begin.

Thanks, Paulette. Good morning. And thank you for joining us today for our 2019 second quarter results webcast. With me on the webcast this morning is our CEO, Lombardo Paredes. I will first go through our prepared remarks regarding our performance in the second quarter and first half, and then Lombardo will be available as we open things up for the Q&A session. Before we proceed with the presentation, I would first like to draw your attention to our legal disclaimer regarding forward-looking statements that may be made by us during the webcast this morning. Last night, we released our operating and financial results for the second quarter and first half of 2019. We're very pleased to be able to report another solid quarter consistent with our expectations. In the second quarter, almost all of our operating and financial metrics, as highlighted on this slide, showed improvement compared to the second quarter last year. For the first half of this year, production growth, the lower cash cost, have been catalysts to improved adjusted EBITDA, earnings and cash flow results, which in turn are helping us to keep our balance sheet in a solid position. Over the next few slides, we'll take a closer look at the results we reported last night. Our second quarter gold production was up 9% over the second quarter last year. Combined with the record gold production we reported in the first quarter, our first half total is up 12% over the first half last year. That brings our trailing 12 months total gold production at the end of June 2019 to about 231,000 ounces, up almost 6% over 2018's annual gold production. Based on our first half operating performance and July's production of another 18,166 ounces, we are now comfortable enough to raise our guidance…

Thank you [Operator Instructions]. And we do have a question online from Derek Macpherson from Red Cloud. Please go ahead.

Thank you, and congratulations on a solid quarter. My question relates to the cash flow guidance. So obviously you guys have a very strong first half bolstered by some higher grades at Providencia. And that has you sort of well below even your adjusted guidance. Is that -- based on the adjustment, are we expecting grade to be down a bit and then cost to be correspondingly up a bit in the second half to reflect that?

Q1 was an abnormally, I would say, low cash cost given the very high grades that we got and talked about with that production. Q2's cash to costs, which averaged 655, is probably more like what we expect to see over the next two quarters. So that should be in that range of $655 or so give or take a little bit over the next couple of quarters. I don't think you're going to see us have our cash costs jump up significantly given the cost structure we have at Segovia.

Okay, that makes sense to me, and that's all the questions that I have. Thank you guys.

Great. Thanks, Derek. Okay, there is one question I've got coming in through the webcast from [Nick Moss]. The gold production guidance for 2019 is between 2250,000 and 240,000 ounces. Is management expecting to sustain these higher levels of production and if so for how long? Lombardo maybe you'd like to respond to that?

Yes. Well, in the last part of this last year, we expanded and exercised just to try to elevate the production in Segovia at the level of 240,000 to 250,000 ounces of gold. And we then -- we've grown and exercised with SRK just to identify potential issues that we have to solve to stay at that level. And then one of the main issues that are outside of this exercise was exploration. So in order to maintain and to increase the level of production in Segovia, we have to do more exploration. In our company, for example, we did not do explorations out in the years 2013, '14 and '15. Then we designed an aggressive exploration program. We hired SRK to produce a structural geological model. And also we hired GoldSpot, which is a company we use which is totally we use neural network and artificial intelligence applied to exploration data. So we combine those -- we are combining two things, the work done by SRK with the work that is running by GoldSpot. With that, we expect that we are going to have a nice exploration program, with more certainty than the normal exploration programs. And we have also the money for that. Remember that we realized some money that we have in cash just to fund that exploration program. So based on that, we believe and we expect that we can increase the production in Segovia, if not to the level of 2,050 ounces of gold for the year [2,000] and [50,000] at the level from 220 to 250. And what generally -- in the next six to nine months, we will realize if that problem is going to be -- to evolve as we expected or not. And in relation with Marmato, and El Silencio, but Marmato, as you know Marmato, we have on a steady production of 35,000 ounces of gold. But with the new project, which is progressing fine, we expect to add for the year 2020 -- by the end of '22 or '23 to add 150,000 ounces of gold.

Great. Thanks Lombardo. Lombardo, I have one more question that's come in through the webcast that I'll read from you. It's from [Nick Picard]. Now that the mill is up to 1,500 tons per day, how much should we expect tonnage production to increase over the next couple of quarters, given we averaged 1,100 tons per day in the first half?

Well, as we announced we are increasing our processing capacity in Segovia from 1,500. And the next step is just -- we expect to maintain that level of -- at that level of processing capacity for the next two quarter, three quarter, not only with that. We have enough mineral nowadays to maintain that production. But our expectation is to increase the Maria Dama -- our processing plant capacity to 2,000 tons per day. And based on the exploration program that we have in development, we believe that we can fulfill that expectation.

So, Lombardo, of the 1,500 in the next -- in Q3 and Q4, how much do we think we'll use of that 1,500 in Q3 and Q4 this year? Will we fully use 1,500 or will it be something a little less?

We have no -- in the next two quarters, we are working with the 1,500. Now -- in fact, that in part of this month, we are -- even with the adjustment that we did in the plant and the early problem that the plant presents when you have some modifications, heavy modification into a plant. I don't have -- I do not expect any problem to maintain 1,500 during the next two quarters.

Okay. Thanks. Paulette, do we have any other calls on the line?

We're showing no further audio questions.

Okay. With that, I'd like to thank everyone for joining us this morning. I look forward to keeping updated as we progress, both with the drilling and the operational programs, as well as the Marmato studies. And if you have any questions, please feel free to reach out to us. So thank you for attending this morning.

Thank you, ladies and gentleman. This concludes today's conference. Thank you for participating and you may now disconnect.