Good morning ladies and gentlemen. Thank you for standing by. Welcome to the HudBay Minerals Inc, Q1 2016 conference call. [Operator Instructions] I would like remind everyone that this conference call is being recorded today April 29 at 10 AM Eastern time. I will now turn the conference over to Ms. Candace Brule, Investor Relations. Please go ahead.

Thank you, operator. Good morning and welcome to HudBay's 2016 first-quarter results conference call. HudBay's financial results were issued yesterday and are available our website www.hudbayminerals.com. A corresponding PowerPoint presentation is also available and we encourage you to refer to it during this call. Our presenter today is Alan Hair, HudBay's President and Chief Executive Officer. Accompanying Alan for the Q&A portion of the call will be David Bryson, our Senior Vice President and Chief Financial Officer; Cashel Meagher, our Senior Vice President and Chief Operating Officer; Eric Caba, our Vice President of the South America Business Unit; Rob Winton, our Vice President of the Manitoba Business Unit; and Pat Merrin, our Vice President of the Arizona Business Unit. Please note that comments made on today's call may contain forward-looking information and this information by its nature is subject to risks and uncertainties and as such actual results may differ materially from the views expressed today. For further information on these risks and uncertainties, please consult the company's relevant filings on SEDAR and EDGAR. These documents are also available on our website. As many are aware effective July 1, 2015 we converted reporting to US dollars and therefore all amounts are in US dollars unless otherwise noted. And now I'll pass the call over to Alan Hair. Alan?

Thanks Candace. Good morning everyone. The achievement of commercial production at Constancia last year, solidified HudBay's transition into a low-cost high-quality copper producer. In the first quarter of 2016, we saw increased copper production volumes and lower cash cost per pound of copper produced resulting in increased operating cash flow versus the same quarter last year. Copper production increased more than 150% to approximately 39,000 tons despite having reduced throughput to Constancia while the trunnions on one of the grinding circuits were being replaced March. As a result, we nearly doubled our revenues to $254 million compared to the same period in 2015 notwithstanding lower realized copper and zinc prices. Earlier this year in response to lower commodity prices we took specific actions to reduce capital and operating costs. The initial results of those assets were evident during the first quarter. As a result of the ramp-up of production at Constancia and ongoing cost-reduction initiatives consolidated cash costs net of byproduct credits decreased to $1.15 per pound from $1.44 per pound in the first quarter last year. Similarly, incorporating saving cost royalties and copper G&A consolidated all in sustained cash cost net of byproduct credits was $1.80 per pound a decline from $2.67 per pound in the first quarter last year, reflecting significantly higher copper reduction from the ramp up of Constancia. Operating cash flow grew to approximate $72 million or $0.31 per share from approximately $70 million or $0.07 per share in the same period last year. Net loss and loss per share in the first quarter 2016 were $15.8 million and $0.07 respectively. Net loss reflects $23 million in interest expense that’s no longer been capitalized following the achievement of commercial production in Constancia on April 30, 2015. Based on our operating and cost performance to date we're…

I didn't think I would be first. David Bryson, you talk about maximizing free cash flow now that you’ve got everything settled down. What do you think your cash balance will look like by the end of the year in terms of some kind of quantum from where we are now or how do you think free cash flow evolves over the course of the year?

Hi, Greg. Obviously, it's going to be partly a function of copper prices, but given that we had set the business with the cost reduction initiatives in the debt to rescheduling earlier this year to be no worse than breakeven at two dollar copper prices, assuming that we sustain in and around the $2.25 range, we should definitely do better than that. Q1 was expected to be a bit of a lower point in the total liquidity, which is how we tend to think about it just given that you can drawdown on and repay revolving credit facilities based on working capital requirements. So going forward, I think, we certainly expect improving cash flow both from the Peruvian sales tax refunds, but also outside of those working capital dynamics seeing good cash flow from Peru as well as Manitoba with Peru running with both lines for the balance of the year and as we've talked about getting the Manitoba production backup with the higher grades and full mill throughput.

So spot copper dated at, say, $2.25? Where do you think you are going to be?

Well, I think in terms of sort of bottom line free cash flow I think that you probably be in $50 million to $100 million range up from where you were at the end of December 2015 adjusted for an – sort of revolver drawdown and some repayments.

Does that include the Peru sales tax refund?

Yeah.

Yes, it does, okay. And that's about $40 million to $50 million, if I remember correctly?

For the year, yeah.

Yeah, for the year. Okay. Great, thank you.

Your next question will come the line of Stefan Ioannou with Haywood Securities. Please go ahead.

Great. Thanks very much guys. It's great to see the – they are trying to replace some quickly. Just wondering in Manitoba, can you just comment maybe a bit more on the unscheduled downtime at Flin Flon, like what actually happened there?

Hi, Stefan, Cashel here. Basically what we did is we had a breakdown on two pieces of equipment associated the mill, one was the crusher in Flin Flon and the other was a belt tear and both of those took us down for about eight days. So they are one offs and we do have capacity in the mill and we have stockpiles in front of it now and we will work through that throughout the balance of the year.

Okay, great. And then just looking at the Canadian facility $39 million was drawn, was that just working capital that you wanted to sort of take advantage of? Or anything else there?

Yeah, I would say that was mainly related to just the interest payment at the end of March and just wanting to ensure that there was ample liquidity. I think assuming that cash flow moves where we expect it to over the balance of the year, we look to pay that back down.

Okay. And maybe just one sort of housekeeping question, juts on the senior unsecured notes, I know in the note it says that it’s – the semiannual stuff, that’s been payable on April 1, but from accounting point of view, it actually goes out on March 31, does that – just so I’m clear on that.

From an actual cash management perspective, you have to actually send the cash to the trustee a couple of days prior to the scheduled payment date.

Yeah.

So what happens is, it leaves our bank accounts on about March 30 and then at that point, we reclass it from cash and cash equivalents over to a prepaid obligation. And so, at that point, it comes out of our liquidity calculations.

Yeah, okay, so, the bottom line that your cash position and everything versus – and your liquidity that you stated here includes that payment obviously at March 31, if you will.

It reflects that payment having gone out the door, yeah.

Yeah, okay, great. Thanks very much guys.

[Operator Instructions] We’ll now take our next question from the line of John Tumazos with John Tumazos Very Independent Research. Please go ahead.

Thank you. In terms of the information flow over the balance of the year, you expect a new technical report incorporating Pampacancha, you expect the new technical report at Lalor by year end. You didn’t say a new technical report at Rosemont if I heard you correctly. Are there any new projects or new capital needs likely to advance either from successful drilling at Lalor, at Constancia or new external opportunities that might change priorities in your project queue? Could Rosemont be a candidate for JV partner?

Okay. John, I think we prefer to characterize, we’ve set the sales up when we made our spending reductions that we announced last quarter to try and minimize discretionary capital expenditure through the course of 2016, but obviously in this current environment, we are looking forward to turn-off cash. So we do with the opportunity to be maybe potentially advancing, but those aren’t in our plans right now. We are looking to, as a say, still to be recently cautious, but as the year progress, we may take a different view in that.

As we look at the different projects in the pipeline, John, as Allen mentioned, we’re going to evaluate things like Lalor, like Pampacancha, and Rosemont as they develop depending on the returns and payback periods associated with that. We already have a joint venture partner at Rosemont and so we think a lot of – there is still work to be done in terms of developing an eventual financing plan with Rosemont, but that’s a bit hypothetical until we have permits in hand and a corporate price that would support Rosemont’s development. In the meantime, we don’t expect to make significant capital commitments to Rosemont other than just steadily moving it forward and meeting the objectives that we’ve set for the project. And Lalor and Pampacancha as we have more information we’ll have more insight to share in terms of what the path forward for those initiatives will be.

Should we optimistic that the new technical study at Lalor brings new reserves and resources?

Hi, John, Cashel here. I think the normal process goes as you convert resource to reserve and that’s what we’re doing in the corporate gold zone and the gold zone and we intend to bring that forward at the conclusion of the drilling. And so far to-date, the drilling is very encouraging, proving out sort of what the resource has already indicated.

Thank you.

It appears there are no further questions at this time. I’d like to turn the conference back to Mr. Alan Hair for any additional or closing remarks.

Thank you, operator, and thank you all for participating. Ladies and gentlemen, this concludes the conference call for today. Thank you for participating. Please disconnect your lines.

Ladies and gentlemen, thank you very much for participating. You may now disconnect your lines.