IAMGOLD - Earnings Call - Q4 2024

Transcript

Operator (participant)

Thank you for standing by. This is the conference operator. Welcome to the IAMGOLD 4th Quarter and Year End 2024 Operating and Financial Results Conference Call and Webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. At this time, I would like to turn the conference over to Graeme Jennings, Vice President, Investor Relations and Corporate Communications for IAMGOLD. Please go ahead, Mr. Jennings.

Graeme Jennings (VP of Investor Relations and Corporate Communications)

Thank you, Operator, and welcome everyone to our conference call today. Joining us on the call are Renaud Adams, President and Chief Executive Officer, Martin Theunissen, Chief Financial Officer, Bruno Lemelin, Chief Operating Officer, Dorina Quinn, Chief People Officer, and Annie Torkia Lagacé, Chief Legal and Strategy Officer. We're coming today from IAMGOLD's Toronto office in Canada, which is located on Treaty 13 territory on the traditional lands of the many nations, including the Mississaugas of the Credit, the Anishinaabek, the Chippewa, Haudenosaunee, and the Wendat peoples.

At IAMGOLD, we believe respecting and upholding Indigenous rights is founded upon relationships that foster trust, transparency, and mutual respect. Please note that our remarks on this call will include forward-looking statements and refer to non-IFRS measures.

We encourage you to refer to the cautionary statements and disclosures on non-IFRS measures, including the presentation and the reconciliations of these measures in our most recent MD&A, each under the heading Non-GAAP Financial Measures. With respect to the technical information to be discussed, please refer to the information in the presentation under the heading Qualified Person and Technical Information. The slides referenced on this call can be viewed on our website. I will now turn the call over to our President and CEO, Renaud Adams.

Renaud Adams (President and CEO)

Thank you, Graeme, and good morning, everyone, and thank you for joining us. Last year was a monumental year for IAMGOLD, as the company achieved critical milestones that have positioned the company as a dynamic, modern, multi-asset material gold producer with significant potential for free cash flow growth and expansion.

IAMGOLD finished 2024 with total attributable gold production of 667,000 gold ounces, a 43% increase from the prior year and in line with our previously raised guidance estimates. This performance was driven by the successful startup of Côté Gold, as well as exceptional operational output from Essakane and Westwood. Financially, the company took significant steps to improve its financial position and capitalize on the strong operating results and robust gold market.

Highlights in the year include the completion of the repurchase agreement to return to the 70% interest level at Côté Gold, the successful net delivery and completion of half the legacy gold prepayment arrangement, all while still generating a total adjusted EBITDA for the year of approximately $781 million, and further strengthening our balance sheet and financial flexibility with the bolster credit facility, resulting in us ending the year with total liquidity of approximately $767 million and the expectation of increasing free cash flow this year.

Additionally, last night, alongside our financial results, we disclosed our updated mineral resources and reserve estimates, the highlights of which were a significant increase in ounces and grades at our Nelligan project located in the Chibougamau region.

With the update, Nelligan is now among the top largest gold deposits in Canada and is expected to continue to grow, all while being located in the top-tier mining jurisdiction. Another highlight from the mineral resources update was at Essakane, where the teams were able to increase the mineral reserves after accounting for depletion, suggesting another potential year of mine life for the strong cash-flowing asset.

Over the last few years, IAMGOLD has seen a rapid growth of value, production, and mineral resources within Canada, where now today approximately 80% of our measured and indicated ounces and 90% of global inferred ounces are located in Canada in well-established mining jurisdictions.

In the near term, our goal is clear: to ramp up Côté Gold to a steady, sustainable state operating at the nameplate throughput level of 36,000 tons per day in the Q4 of this year, while maximizing our measured and indicated resources at Côté and Gosselin in support of a technical report in 2026 that would outline a unified mine plan based on Côté and Gosselin. Meanwhile, we will continue safe mining activities at Essakane and Westwood to maximize production while managing our cost drivers with a focus on cash flow margin preservation.

Should the current gold price environment remain in place, by the middle of this year, we anticipate we will have our gold prepayment facility behind us, with Côté, Essakane, and Westwood capable of generating record cash flow and conceptually well-positioning IAMGOLD to begin the process of delivering its balance sheet, starting with our high-cost dense vehicles to further refine our capital structure and moving closer to our goal of becoming a leading modern Canadian gold producer with a strong balance sheet and assets that are poised to generate significant value for our stakeholders, partners, and investors.

Looking at the highlights from the year and the Q4, at IAMGOLD, we strive to be among the leaders in health and safety, talent development, and ESG, including tailings management, water stewardship, and community well-being. Looking at last year as a whole, our total recordable injury frequency rate was 0.63, an improvement from the prior year. Ensuring all of our employees and contractors go home safely would always be the primary focus for IAMGOLD, and to succeed, every gold ounce produced has to be done safely.

On production, in the Q4, the company produced 177,000 ounces, bringing total annual production to 667,000 ounces on an attributable basis, in line with our guidance, which was raised mid-year to 625,000 to 715,000oz. Total annual productions in 2024 was 43% higher than 2023, driven by a strong first half at Essakane, a near-record year at Westwood, and the startup of Côté Gold, which produced 124,000oz to our account in the first nine months of operation.

Cash cost per ounce sold, excluding Côté, was $1,176 for the year, at the low end of our guidance range of $1,175 to 1,275, and $1,393 per ounce for the Q1. All-in sustaining cost per ounce sold, excluding Côté, was $1,725 for the year, trending towards the low end of our guidance range of $1,700 to $1,825, and $2,071 for the Q4. Cash cost and AISC increased quarter over quarter through 2024.

This was primarily associated with rising waste stripping and lower relative grades at Essakane, as the mine opened up and started mining of new phase as per the mine plan. On an annual basis, while costs are in line with the prior year, they remain relatively high due to continued pressure on supply chains within Burkina Faso, as well as sustained elevated prices on certain consumables and labor.

With that, I will pass the call over to our CFO to walk us through our financial results and position. Maarten?

Maarten Theunissen (CFO)

Thank you, Renaud, and good morning, everyone. In terms of our financial position, at the end of the year, IAMGOLD had $347.5 million in cash and cash equivalents and net debt of $859.3 million. The company has $220 million drawn on the credit facility and approximately $418.5 million remains available, resulting in liquidity at December 2024 of approximately $767 million.

We note that within cash and cash equivalents, $46 million was held by the Côté Gold UJV, $130.2 million was held by Essakane, and $160 million was held in the corporate treasury. As we highlighted last quarter, but worth reiterating, Essakane declared a dividend during the Q2 of $180 million, for which the minority interest portion and withholding taxes were paid during the Q2, and the company received a total dividend of $151.9 million.

On 30 November 2024, the company issued a payment of $377.7 million to complete the repurchase of the 9.7% interest in the Côté Gold mine that was transferred to Sumitomo through the Côté Gold Joint Venture amending and funding agreement, returning IAMGOLD to its full 70% interest in Côté. The repurchase payment was funded through available cash balances and amounts available under the credit facility.

On 23 December 2024, the company announced that it closed the sale of its 100% interest in the Karita Gold Project Associated Exploration Assets in Guinea for gross proceeds of $35.5 million. The definitive agreement to sell the Diakha-Siribaya Gold Project in Mali expired on December 31, 2024, and was not extended. The company is pursuing alternative options for the sale of this asset.

Finally, as of today, the company has completed over half of its gold prepay obligations, having delivered 75,000oz into the 2022 gold prepay arrangements, of which 37,500oz were delivered in the Q4 and a further 12,500oz during January 2025, reducing the outstanding balance of all prepay arrangements to 62,500oz as of 31 January 2025.

The company received $10 million in cash in the Q4 and $38.9 million for the year as part of the delivery of the obligation. Please refer to the liquidity outlook section of the MD&A for further details. Looking at our annual financial results for 2024, we saw the impact of strong gold production at record high gold prices, resulting in the company realizing higher margins and generating higher operating cash flows during a critical year for the company.

Revenues from operations stood at $1.6 billion for the year from sales of 699,000oz at a record average gold price of $2,330 per ounce, after accounting for the impact of the gold prepays. The strong operating results and gold price resulted in another year of increased adjusted EBITDA, which stood at $780.6 million in 2024, double the 2023 value, while Côté Gold is still in the early stages of ramp-up.

Net earnings were $819.6 million for the year and include the reversal of prior impairment on Westwood of $455.5 million as a result of the improvement of the value of the operation, compounded by an update to the long-term gold price assumptions. Adjusted earnings were $296 million. On a per-share basis, adjusted earnings per share for the year totaled $0.55, a notable increase from the prior year of $0.09.

Looking at the cash flow reconciliation for the year offers a good visualization of the major drivers of our available liquidity to the end of 2024. Operating activities fueled by strong operations at Essakane, Westwood, and the start of the production at Côté Gold were adjusted for the impact of the gold prepay deferred revenues and prepay proceeds in the first half of the year.

Investing activities in 2024 were primarily driven by the completion of construction of Côté Gold and sustaining capital spent at our projects. Financing activities were bolstered by the share issuance in May 2024 at a price of $4.17 per share, combined with a drawdown on the credit facility to fund the repurchase of the 10% interest in Côté Gold from Sumitomo and working capital requirements.

As we look to 2025, we believe we have a good opportunity to further improve the strength of our balance sheet should the gold market remain strong. As we saw on the prior page, the company currently has a $400 million term loan, which carries relatively higher interest.

This year offers an important milestone as the term loan can be repaid in $20 million tranches at any time and after May 2025 at a 104% repayment premium, followed by a 101% premium if repaid after May 2026 and at 100% thereafter. Once our gold prepays are behind us, the strong expected cash flows could well position the company to reduce our debt carrying cost and levels. And with that, I will pass the call back to you, Renaud. Thank you.

Renaud Adams (President and CEO)

Thank you, Martin, and congratulations again on your team's achievement last year. Starting with Côté Gold, I want to congratulate the team for their commitment and dedication to the safe ramp-up of Côté Gold. Also, and since first gold, the mine has shown a systematic increase quarter-over-quarter in throughput and gold production.

In the first year of operation, Côté Gold produced 199,000oz on a 100% basis. Looking at the Q4, Côté produced 96,000oz on a 100% basis, which was a 41% increase from the prior quarter. A year ago on this call, we called for an initial gold production in late Q1. Commercial production achieved in the Q3 2024 and set the target for Côté to exit the year at a throughput rate of approximately 90% of nameplate.

We were able to achieve the first two of these milestones, with the Côté Gold mine achieving among the quickest ramp-up into commercial production for large-scale open-pit gold mining in Canada. Despite these successes, Côté Gold was unable to sustainably exit the year at 90% throughput and narrowly missed production guidance of 220,000oz due to lower tons processed during the Q4 as a result of higher than expected downtime in order to conduct unplanned repairs.

Mining activity totaled 10.8 million tons in the Q4 2024, modestly higher than the prior quarter in bringing the total tons mined for the year to 39.3 million tons, with an average strip ratio of 2.6 to 1, resulting in ore tons mined for the year of 10.8 million tons.

The average grade of mine ore was 0.97 grams a ton, with the reconciliations between the grade control and reserve models in line with expected tolerances. Within the pit, the mine currently has two CAT 6060 electric shovels and 21 CAT 793 autonomous haul trucks now commissioned.

Utilization rates of the primary mining equipment have been improving, with the mine achieving a weekly average high operating rate of 150,000 tons per day in December. The current mine plan is using multiple stockpiles segregated by grade, as made evident by the head grade of tons processed in the Q4 of 1.34 grams a ton gold, substantially higher than the mine grade.

As we discussed last quarter, the strategy is proving to require higher than expected amounts of rehandling, which are flowing through our mining cost. Last year, mining costs averaged $3.90 per ton. This is higher than expectation due to the rehandling in addition to higher contractor costs to support the ramp-up of the mine. We expect to see unit mining costs decline as we operate with the full haulage fleet for 2025, coupled with the implementation of an optimized gold mining plan and a reduced need for external support.

Milled throughput in the Q4 totaled 2.4 million tons. This is a 50% increase from Q3 as the plant continued to see improvement quarter over quarter. As the mine transitioned from commissioning to production at the end of Q1 of last year, our teams took the strategy of first testing the capacity of the main equipment and the plant to handle the mill and ore loads, followed by building availability and stability as the ramp-up progressed.

From early on, the primary components of the processing circuit, primary, secondary crushing, HPGR conveyors, ball mill, leaching, etc., proved their capability to operate at or above design load when provided with stable conditions. Further, we saw the recoveries of the plant come in line with expectation of ranging 92% for the first year of operation, a critical achievement for a new mine.

As Côté continued to ramp up through the year, we were able to deploy key optimizations to stabilize a crushing circuit through the replacement of wear parts with higher abrasion resistant material to reduce the level of wear and using new type and sizes of screens in the coarse ore screening area. These improvements allow for further improvement in availability and performance of the secondary crushing and screening circuit, allowing for the plant to achieve multi-day performance above 40,000 tons per day in the Q4.

As the operating rate of the plant increases over longer periods of time, we require unscheduled, yet not entirely unexpected equipment maintenance. For example, in December, the plant was operated at an average of 87% of design throughput level over a two-week period prior to an unscheduled shutdown to split a conveyor belt associated with design issues. Repairs were made to the belt and replacement with a modified design was completed in January 2025.

Subsequent to the quarter end, the HPGR rollers demonstrated accelerated work necessitating a changeover ahead of schedule and limiting the secondary crushing capacity in January. The changeover of the HPGR roll was completed in February 2025, with operating and maintenance procedures adjusted to maximize lifespan and optimize future changeover windows.

Inside the plant, the grinding circuit was also impacted early in the quarter due to repair required to one of the Vertimills following a faulty start of post-maintenance. Prevention and mitigation procedures have been put in place, and the second Vertimill is expected to be online later this month.

Taken together at a higher level, it is not unusual or uncommon to encounter these types of equipment issues during the first year of a ramp-up of the large-scale mining operations, where the equipment is operated at an efficient level at varying rates and stresses, all while maintenance schedules are being adjusted to real-world conditions. What is important is that we are seeing continuous improvement at Côté Gold, with increasing stability, availability, and operating milestones quarter over quarter.

In 2025, we are forecasting production of 360,000 to 400,000oz of gold on a 100% basis, which means that Côté Gold would essentially double its ounces this year. Cash costs are expected to be between $950 to 1,100 per ounce, and all-in sustaining costs to be between $1,350 to 1,500 per ounce. The cash cost guidance reflects the cost experience of the first year of operations, including higher levels of maintenance, contractor support, and continued improvement consulting.

Costs are expected to lower in the second half of the year as targeted improvements are deployed and as production increases. The operating guidance assumes plant throughput of approximately 12 million tons in 2025, equating to an average of 3 million tons per quarter, comparing well with the Q4 throughput of 2.4 million tons, which was 50% above Q3.

So yes, we are confident in the next step, and the next step up after the Q1, which we have advised, will be lower, after which we'll step up into Q4. The end goal for Côté Gold this year is to achieve nameplate throughput of 36,000 per day in the Q4.

This target will be aided by the installation of a second cone crusher, which will provide additional capacity and redundancy to the primary crushing circuit, removing the bottleneck from this area. Longer term, we will continue to pursue improvement in mining and processing activities, looking for low-capital-intensive opportunities to increase processing plant capacity.

As we have noted in the past, several components of the plan have been designed for 42,000 tons per day, and we have seen multiple days above 40,000 tons per day early on in the life cycle of the project. The addition of the second cone crusher later this year is aligned with our strategy of unlocking maximum value by monetizing the maximum number of tons of ore mined as they become available for processing.

This strategy includes evaluating the potential to address certain aspects of our mining plan at Côté Gold to shift over time from selective blasting and separation to a more bulk mining approach as the milled throughput capacity is unlocked. As currently designed, Côté Gold over the life of mine is expected to average an annual ore mining rate of approximately 50,000 tons per day versus our current nameplate processing rate of 36,000 tons per day.

So if we are able to find the right balance of increased processing rates and minimized stockpiles, we expect numerous efficiency advantages, including reduced rehandling, improved pit sequencing, and less reliance on segregation for the mine plan and more on maximizing milled throughput and monetization of gold mine.

Optimizing the processing and mining balance at Côté Gold is even more important as we investigate the potential options to bring into the mine plan the full resource base estimate of the Côté and Gosselin zone, which combine for over 16.2 million ounces of measured and indicated resources and 4.2 million ounces of inferred resources to define Côté Gold as among Canada's largest gold mines in operation.

Our exploration program on Côté and Gosselin is ramping up this year, targeting resource conversion at Gosselin in support of our technical report in 2026 that outlines and unifies the mine plan based on Côté and Gosselin. Turning to Quebec, the transformation of Westwood has been among the best mining success stories in 2024, as the last few years of redevelopment and rehabilitation resulted in a successful turnaround of the mine, building safe and stable production and culminating in generations of $94.4 million in mine site free cash flow for the year.

Looking at operation, Westwood produced 134,000oz in 2024, above the top end of its increased revised production target of 115,000 to 130,000oz. Production in the Q4 of 2024 was 35,000oz, higher by 7,000 or 25% compared with the same prior year period, primarily due to higher grades and an increased proportion of ore feed from the underground mine. Mining activity for the year totaled 1.02 million tons of ore, in line with the prior year.

In the Q4, the underground mine averaged 98,000 tons, or just over 1,000 tons per day, a record volume from underground since the mine restart at an average underground mine grade of 9.65 grams a ton. The improved volume from underground is a result of the completion of the underground rehabilitation and development work program, which has provided increased operational flexibility with multiple stope sequences available to mine concurrently at different levels and sectors of the mine.

Milled throughput in the Q4 of 2024 was 267,000 tons at an average head grade of 4.34 grams a ton and an average recovery of 93%, with grades 11% higher than the prior year period due to the higher proportion of underground material. Plant availability in the quarter was 88%, 10% higher than the same prior year period with the successful completion of the annual mill shutdown in November.

The margins for Westwood continue to improve with a strong gold price and stabilizing costs. Cash costs averaged $1,148 an ounce, and All-in Sustaining Costs averaged $1,688 an ounce in the Q4, positioning the mine in the middle of our asset cost curve. Looking ahead to this year, Westwood production is expected to be in the range of 125,000 to 140,000oz in 2025.

As mining activities continue, the underground ramp-up towards achieving 1,000 tons per day at a stable steady state while targeting multiple active mining areas and minimizing dilution. Open pit activity from the Grand Duc is currently planned to be completed by the Q4 of 2024, though Grand Duc's stockpile material would continue to be milled feed into 2027.

However, should the gold price remain where they are, I believe there is a strong potential for further expansion and extension of the Grand Duc pit, which will be investigated this year. Plans this year are expected to be generally flat, with cash cost guidance for Westwood of $1,175 to 1,325 per ounce, so an AISC of $1,675 to 1,825 per ounce.

Capital expenditure guidance is for approximately $70 million, mainly consisting of underground development and rehabilitation in support of the 2024 plan, the continued renewal of the mobile fleet and equipment overhauls, and certain asset integrity projects at the Westwood mill. Finally, looking at Essakane, it was a lighter quarter at the mine with production of 80,000oz in Q4.

Yet Essakane still achieved the top end of its guidance range, which was increased mid-year, with the mine producing total annual productions of 409,000oz versus guidance of 380,000 to 410,000oz. Mining activity totaled 12.4 million tons in a quarter, with 2.2 million tons of ore mined, resulting in a strip ratio of 4.7, which is relatively high versus recent history, as the mine fleet targeted capital stripping activity intended to secure access to ore on deeper benches of phase VII in support of the 2025 and 2026 mine plan.

Milled throughput in the quarter was 2.9 million tons at an average head grade of 1.07 grams a ton. Throughput was slightly lower in Q4 due to the scheduled maintenance during December. Average head grade decreased in the Q4 compared to the first half of the year, in line with the mine plan as mining activity prioritized waste stripping sequence, resulting in increased supplementation of the mill feed from available ore stockpiles.

On a cost basis, Essakane reported relatively high Q4 costs, with cash costs of $1,501 per ounce and AISC of $2,118 per ounce. These came in relatively high due to the planned lower quarterly production, annual scheduled maintenance activity, higher realized fuel price, and higher supply chain and transportation costs impacted by the security situation.

Despite this, total annual cash costs were $1,179 and AISC were $1,625, both within guidance range of $1,175 to $1,275 per ounce and $1,575 to $1,675 per ounce, which were lowered in the mid-year. Looking ahead, Essakane is expected to produce 360,000 to 400,000oz on an attributable basis at a cash cost of $1,400 to $1,550 per ounce and an AISC of $1,675 to $1,825 per ounce.

Mining activities are expected to complete mining in phase V in the first half of the year, with the bulk of the mine material coming from phase VI and phase VII. With mining moving into the primary zones of phase VI and phase VII, capitalized waste stripping is expected to be relatively lower in 2025, with a total capital expenditure guidance this year of $115 million.

The plant is expected to operate at throughput and head grade in line with the current life of mine plan as per the December 2023 43-101 technical report. While the cost of operations in country have risen over the last two years, Essakane is positioned to generate strong cash flow with an expected decrease in waste stripping expenditure year over year.

I also want to congratulate the exploration team as we announced an updated mineral reserve and resources estimate yesterday, in which Essakane more than replaced its reserve depletion, with current estimated reserve of 2.3 million ounces, and managed to grow measured and indicated ounces by 15% to nearly 100 million tons, grading 1.24 grams a ton for a total of nearly 4 million ounces.

Taken together, this strong result from the drill bit suggests the potential for further mine life extension within the secure perimeter of our operation at Essakane. Finally, and on the topic of notable mineral resources change, yesterday we also announced an updated mineral resources estimate for our 100% owned Nelligan project located approximately 45 kilometers southwest of Chibougamau, Quebec.

The update estimated mineral resource of 3.1 million indicated gold ounces and 103 million tons, grading 0.5 grams per ton, and 5.2 million inferred ounces within 166 million tons, grading 0.6 grams per ton. This represents a 56% increase in indicated resources or 1.1 million ounces, with an increase in grade of 13%, as well as a 13% increase in inferred resources or 1.3 million ounces, with a similar 14% increase in grade.

This update demonstrates a remarkable prospectivity of this asset, demonstrating rapid growth in ounces and an improvement in grade from a relatively conservative drill program that totaled only 23,400 meters over the last two years. When combining Nelligan with a high-grade satellite Monster Lake deposit, there are nearing nine million ounces of resources in this mining camp already, positioning Nelligan at a relatively early stage among the largest gold projects in Canada with significant potential for further growth.

This year, we are increasing the scope of our Chibougamau drill program with a plan for 30,000 meters of diamond drilling, testing the extension of mineralization at Nelligan as mineralization remains open along strike and at depth. Further, a drill program will be conducted targeting high-grade structure underground at Monster Lake, which has seen minimal modern exploration in the last few years.

It is definitely early stage, but there is no question the value that Nelligan can offer as a growing large-scale gold asset in a very mining-friendly jurisdiction in Canada. So thank you all, and I look forward to an exciting year ahead. With that, I would like to pass the call back to the operators for the Q&A portion of the call. Operator.

Operator (participant)

We will now begin the question and answer session. To join the question queue, you may press star, then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star, then two. We will pause for a moment as callers join the queue. The first question comes from Anita Soni with CIBC World Markets. Please go ahead.

Anita Soni (Analyst)

Good morning, Renaud and team. A question on some of the challenges that you've had in January with the HPGR and some of the other crushers. You did issue guidance in January. Can you let us know whether or not your January guidance would have encompassed some of the issues you were encountering? I'm just trying to understand the timing of these issues and whether or not we should be a little bit more conservative than what you had previously put out.

Renaud Adams (President and CEO)

No, I mean, when we issued our guidance, we were absolutely in possession of all the information. We knew about the repair on the mill. We knew the repair of the Vertimill, so that was all accounted for. We knew that the change was already planned in a way to do a changeover of the rolls on the HPGR, so it was just advanced, but it's the same.

As a result, and as I just mentioned, we see Q1 a little lower than the rest, but we're going to pick up and increase with more tons processed in the second half. But no change, and we remain very confident about our guidance.

Anita Soni (Analyst)

Okay, that's good to hear. I did have the Q1 lower with the changeovers happening. And then in terms of the, sorry, the, oh, what was my question? Oh, sorry, the mining rates. How do you see that evolving over the course of the year?

Renaud Adams (President and CEO)

We're actually very pleased. As I mentioned, we were roughly in the 40 million mark for the 2024, the first year, successfully commissioned through the three additional. We've already seen a pickup in the ton mines. Had a wonderful week in December at 150,000 tons.

So to achieve 48 million tons this year, like moving from the previous average of about 10 million to about 12 million per quarter, we absolutely see this achievable. So we'll see in the Q1 because it's still like a ramp-up in the commissioning of the full commissioning of the extra three trucks. But definitely, we have the capacity and the equipment, of course, to achieve our 48 million tons this year.

Anita Soni (Analyst)

Okay. That's it for my questions. Thank you.

Operator (participant)

The next question comes from Tanya Jakusconek with Scotiabank. Please go ahead.

Tanya Jakusconek (Analyst)

Good morning, everybody. Thank you for taking my questions. And I'm just going to follow up from Anita's question on Côté. So just wanted to circle back, Renaud, just as we think about and maybe just a bit more detail as we go through the quarter.

So Q1 is weaker because of these changeovers that happened at the mill. Was anything else planned or is planned for downtime in Q2, Q3, Q4 as you do some additional repairs and/or turnovers? I think there was something coming in later in the year as well that may have some downtime. So just trying to understand, should I be thinking you had mentioned 3 million tons per quarter, but how should I be thinking of each quarter and some of the critical aspects that we move in this ramp-up during the year?

Renaud Adams (President and CEO)

Yeah, I'll ask Renaud to add a bit of color to this, but obviously, as per the HPGR, per se, that was an advanced maintenance from Q2 to Q1, so no real difference. But Renaud, you could add to this.

Thank you, Renaud. Good morning, Tanya.

Tanya Jakusconek (Analyst)

Good morning.

Exactly what Renaud just mentioned, the rolls replacement for the HPGR were scheduled to be taking place in May with the maintenance. Like now we are understanding the wear pattern better.

The other major shutdown is going to be the one in August, the annual shutdown, but with the wear pattern that we're seeing at the ball mill, it's very likely it's going to be shorter than expected also because we're seeing a wear pattern that is less abrasive than expected. This is where we are right now, Tanya.

We are understanding and learning the wear patterns at all our primary components. The HPGR was a little bit faster, and the ball mill seems to be holding very well right now. Other than that [crosstalk].

Anita Soni (Analyst)

So if you were to think about the quarters, so Q1 is the weakest, Q4 is going to be the strongest, and do we see a progression upward, or is Q3 and Q2 equal? I'm just trying to understand with this downtime in August.

Yeah, because in Q2, you won't have to do the HPGR rolls replacement. So definitely, Q2 is going to be higher than Q1, and after that, Q3 will also pick up in speed.

Tanya Jakusconek (Analyst)

Okay. So you will, despite all of these changes and things, you will see quarter-over-quarter improvements is what you're saying.

Renaud Adams (President and CEO)

That's correct. Probably Q2, Q3 closer to each other for different, but definitely Q1 the lowest and Q4 the best. And as you say, Q2, Q3, hopefully Q3 a little bit more than Q2. We'll be starting installations of the second crusher by mid-Q3, late Q2, early Q3.

So there should be minimal disruptions, but there is always some time to be done. So on that basis, you could argue that Q2, Q3 should be very similar or close to, but Q4 definitely should be our strongest.

Tanya Jakusconek (Analyst)

Okay. And anything else on the critical path that we need to be aware of as we go through the year besides these changes that you've mentioned? Anything else? I mean, the mining, we've got the three new trucks or thereabouts coming in that's going to help on the mining front. But anything else that we should be aware of?

Renaud Adams (President and CEO)

It's really all about the stability, Tanya, and I appreciate during the commissioning, every quarter, unfortunately, this happened and so forth. But as Renaud mentioned, I think we've learned enormously from this.

Basically, it's all about, okay, of course, you have a design criteria of how many hours you should do and so forth and the wear pattern, and you need to adjust. Some equipment, of course, may be less familiar with some operators and more training. But globally, I think we've gone through the whole cycle from the crushing to the grinding to the leaching and regrind. I think we've gone through the whole cycle.

We have a much better understanding of each of the equipment. So it's all about stability. So to answer your questions, we feel strong about the 48 million tons. We're already seeing improvement in the pit. And as I've discussed, we'll be less queued and super segregations and allow for more performance and productivity in the pit. So we feel very strong with the mining.

And when it comes to the mill, it's really all about stability at this stage. And so we're really looking forward now with the last repair of the Vertimill to really push the gas and crank up the tonnage and go for more stability and higher availability. And with that, you know the capacity is there. So as you approach a 90% plus availability, you will be there. There is no capacity issues. It's just the stability matter. So it's not a long answer, but I thought I would clarify.

Tanya Jakusconek (Analyst)

Okay. No, thank you for that. And then I'm just wondering on Essakane as well, as you moved from this phase V into phase VI and phase VII this year, and yet there's less stripping. How does the profile look for the year there? I'm just trying to understand overall for the company, how does the year progress?

Is it that we start with a lower Q1 overall for the company and get to a higher Q4? I'm just trying to get an understanding if there's any variability in Essakane and Westwood as well.

Renaud Adams (President and CEO)

Yeah, thanks for that question and the opportunity to clarify a bit because absolutely. So unfortunately, at the same time, Q1 is a bit of the quarter for Côté, a bit of repair the first half and so forth. At the same time, we're entering phase six and seven.

And we have more than once discussed the performance on the grade reconciliation as you enter new phases at a very early stage versus when you're well established. And we've seen that in 2023, 2024 with the phase five. We still have phase V until probably mid-year, but we're entering phase VI, phase VII with a little bit slower and less productive in grade.

So as a result, we see Essakane potentially on target, but because of the six-seven, it could be that Essakane is slightly lower in the Q1 and the pickup after that for the rest of the year. But originally, we were seeing about same, but it could be possible that Q1 is slightly lower than the rest of the year.

Tanya Jakusconek (Analyst)

Okay. That's helpful as well. So it kind of looks that you probably are seeing that quarter-over-quarter improvement for the company overall in 2025. Okay. It's a fair comment. Okay. And if I could just squeeze one more in, and it just is more a strategic question for you. Just you mentioned over 90% of your M&I and inferred resources all sitting in Canada.

As we get Gosselin drill program study and then a better understanding of the mine plan for the whole Côté Gold complex, do you think it makes sense to keep Essakane within IAMGOLD? You then have your cash flow coming. Do you think that by selling Essakane, remaining a totally Canadian company, you'd get a better valuation?

Renaud Adams (President and CEO)

I think you're talking about something that belongs to the more looking forward type of thing. We're very pleased with Essakane. The truth is that we've discussed numerous times the strategic approach with Essakane, and we're looking at delivering in our balance sheet in 2025, 2026, the strong free cash flow. It's all about the stability, right? We had a very strong 2024. We had no interruptions in our productions, and we've delivered on all metrics.

To be very frank, you could argue that we've seen more stability than a lot of North American mines, if you want my take of it. So I won't really comment on the details of our plan. What I know is that we have strong belief that Essakane will be a strong free cash flow generators and will make a huge difference for us for 2025 and 2026 as we significantly improve our balance sheet.

The rest belongs to stability, how things evolve, and so forth. So there is a lot at stake here, but we feel very confident to deliver another strong 2025.

Tanya Jakusconek (Analyst)

Okay. That's a fair comment. Thank you very much for taking my question.

Renaud Adams (President and CEO)

Thanks.

Operator (participant)

There are no further questions. I will now hand the call back over to Graeme Jennings for closing remarks.

Graeme Jennings (VP of Investor Relations and Corporate Communications)

Thank you very much, operator. Thanks to everyone for joining us this morning. As always, should you have any additional questions, please reach out to Renaud or myself. Thank you all. Be safe and have a great day.

Operator (participant)

This brings to a close today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.