Hudbay Minerals Inc. (HBM:CA) Shareholder/Analyst Call Transcript

2026-05-27 15:10:00 ET

Hudbay Minerals Inc. (HBM:CA) Shareholder/Analyst Call May 19, 2026 2:00 PM EDT

Company Participants

David Smith
Mark Haber - Vice President of Legal & Corporate Secretary

Presentation

David Smith

Hello, and welcome to the 2026 Annual and Special Meeting of the Shareholders of Hudbay Minerals Inc. My name is David Smith, and I am the Chair of the Board of Hudbay. I would like to welcome all shareholders, employees and other rights holders and stakeholders that are attending our virtual shareholders' meeting today. Before we begin with the formal business of the meeting, I would like to briefly reflect on some of Hudbay's achievements in 2025. We delivered another year of record financial performance driven by our resilient operating platform. Through significant free cash flow generation, we further strengthened our balance sheet and reduced our debt levels, positioning Hudbay well as we advance toward a potential sanctioning decision at Copper World later in 2026.

Additionally, 2025 was the 11th consecutive year in which we achieved our annual consolidated copper production guidance and the fifth consecutive year in which we achieved our annual consolidated gold production guidance. In Arizona, we made substantial progress advancing our Copper World project. Following receipts of the final permits, we successfully completed a joint venture transaction with Mitsubishi Corporation in early 2026, as Mitsubishi acquired a 30% minority interest in the project for $600 million. We are very excited to have Mitsubishi as our partner for this project, and the completion of the joint venture transaction marks a significant milestone in derisking Copper World for Hudbay.

In Manitoba, we once again delivered consistent operating performance despite contending with serious wildfires and other weather-related challenges during the year. And most importantly, we did so safely. We also continue to prioritize strong relationships with local and indigenous communities in the areas in which we operate and are seeking ways to continue to grow our business in Manitoba. In British Columbia, we continue to advance our multiyear optimization plan at the Copper Mountain Mine and our second full year of operations post-acquisition, and we remain focused on positioning the asset for improved reliability and long-term performance.

In addition, in early 2026, we signed refreshed participation agreements with each of the lower and upper Similkameen bands and received the permit for our New Ingerbelle project. In Peru, our operations remained a strong contributor to our overall results. With the completion of mining at Pampacancha, consistent mill throughput and continued progress on key permitting initiatives. This was accomplished while safely managing temporary social unrest in the latter part of the year. Across our business, we remain focused on advancing our sustainability initiatives, and we are pleased to have published our 2025 annual report this morning. This report highlights many of our recent sustainability accomplishments and our commitment to setting the gold standard in everything we do.

We reduced our total recordable injury frequency for the fourth consecutive year. We made more than $16 million in community investments, and we made strides in advancing our greenhouse gas emissions reduction strategy. In March 2026, we also announced the proposed acquisition of Arizona Sonoran Copper Company, pursuant to which Hudbay agreed to acquire all of the issued and outstanding common shares of Arizona Sonoran that it does not already own. Last week, Arizona Sonoran security holders voted in favor of the transaction at a special meeting of shareholders, and the parties expect the transaction to close later in the second quarter. For Hudbay, the acquisition is expected to further enhance our long-term copper production profile and expand our U.S. growth pipeline.

These are only a few examples of our accomplishments and focus areas from the last year, and none of these would have been possible without the dedication and resilience of our people. I would like to take this opportunity to thank our employees for their continued contributions to Hudbay's success. I'm especially proud of the job done by our organization to keep our people and local communities safe. On behalf of the rest of our Board, before we commence with the formal portion of the meeting, I would like to express my sincere thanks to Steve Lang for his many years of dedicated service and contributions to Hudbay, including his long tenure as Chair of our Board. Steve has elected not to stand for reelection at today's meeting due to health reasons, and we wish Steve the very best.

Now let me introduce the members of the Hudbay Board, who, in addition to myself, are nominated for election at today's meeting. Peter Kukielski, our President and Chief Executive Officer; John Armstrong, Jeane Hull, Carin Knickel, George Lafond, Colin Osborne, Paula Rogers and Laura Tyler. Joining me today for the formal portion of the meeting is Peter Kukielski, our President and Chief Executive Officer, who will be available for the Q&A period at the end of the meeting; and Mark Haber, our Vice President, Legal and Corporate Secretary, who will act as Secretary of the meeting.

We will now start with the formal business of the meeting, which we will try to complete as quickly as possible. I've asked certain shareholders to move and second proposals we have on the agenda. After all the motions have been tabled, we will open the floor to discussion and questions on the motions. If a registered shareholder or proxy holder with a control number has a question related to one of the matters to be considered, I'd ask that they type it into the questions interface on Lumi. Mark will then raise these questions during the discussion period, and we will respond. The only questions that will be permitted prior to the discussion period will be those related to procedural matters. If you are not a registered shareholder or proxy holder with a control number and would like to ask the Board of Directors a question, applicable e-mail and mailing details are included in our management information circular for this meeting.

As mentioned in our management information circular, only registered shareholders and proxy holders who have registered for a control number are able to vote at this meeting. Voting will be open for all resolutions at the same time. This will allow you to choose to vote on each resolution immediately or to wait until discussion concludes on each resolution prior to casting your vote. Should you choose to do so, you will be able to change your vote on any resolution until voting is closed at the end of the formal portion of the meeting. Once the voting has closed, we will take a few minutes to tabulate a preliminary report. I now call the meeting to order. I will act as Chair of the meeting. I will ask Mark to act as Secretary of the meeting and Christopher de Lima of TSX Trust Company to act as scrutineer.

This year, Hudbay has continued to use notice and access to provide shareholders with access to materials for our annual and special meeting. Mark has advised me that the notice and access, notice and form of proxy have been forwarded to each registered shareholder and intermediary of record as of the record date of the meeting. All proxy-related materials are available electronically on our corporate website, on the website of our transfer agent, TSX Trust Company, and under the issuer profiles, SEDAR+ and EDGAR. Links to these materials are also available on Lumi's homepage for this meeting.

In addition, shareholders may obtain paper copies of the proxy-related materials by contacting our transfer agent, TSX Trust Company, according to the instructions provided in the notice and access notice. Mark has advised me that he has been provided with the scrutineer's report, which shows that there are 450 shareholders represented at the meeting or by proxy, holding in aggregate 276,024,905 common shares, representing approximately 70% of Hudbay's outstanding common shares. Accordingly, this meeting is duly called and properly constituted. I would ask Mark to attach the affidavit of mailing, copies of the meeting materials and the scrutineer's report to the minutes of the meeting. I do not plan to read the minutes of last year's meeting.

I do not plan to read the minutes of last year's meeting. Any shareholder who would like to review those minutes should contact Mark after the meeting. He can be reached by e-mail at legal@hudbayminerals.com. The first item of business on our agenda is the presentation of financial statements of Hudbay for the year ended December 31, 2025, together with the related auditor's report. These were made available to shareholders through notice and access. Links to these materials are also available on Lumi's homepage for this meeting. These documents have been tabled and no further action is required.

We will now proceed with our second item of business, the election of directors. Voting through the Lumi web portal is now open on all resolutions. I would like to remind you that you will be able to change your vote until voting closes. We'll give you notice before this occurs. In addition to myself, the proposed nominees for election as directors of Hudbay are: Peter Kukielski, our President and Chief Executive Officer; John Armstrong, Jeane Hull, Carin Knickel, George Lafond, Colin Osborne, Paula [indiscernible] and Laura Tyler. If elected, we expect these nominees will hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed. In light of our advanced notice bylaw, I declare -- I hereby declare the nominations closed.

In line with our corporate governance guidelines in the CBCA, each director nominee will be elected individually and is subject to the majority voting requirements under the CBCA. However, I'm advised that based on proxies received to date, each proposed nominee would receive a greater number of votes for his or her election than would be against his or her election, and none of the proposed nominees would be required to tender a resignation under the CBCA majority voting requirement. So unless a shareholder or proxy holder requests separate motions to elect the individual nominees, I propose that we proceed with a single motion. May I have a motion for the election of the 9 individuals nominated as directors?

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