Allied Gold Q2 2026 Earnings Call Transcript

Quartr
Provided by Quartr
August 6, 2026

Key Takeaways

  • Positive Sentiment: Kurmuk remains on schedule to begin production in September 2026, with commissioning underway, ore stockpiles building, and project costs tracking to budget. Management expects a four- to six-month ramp-up and higher-than-planned initial grades, potentially supporting approximately 240,000–270,000 ounces annually and all-in sustaining costs below $1,200 per ounce.
  • Positive Sentiment: Second-quarter production reached just over 97,000 ounces, while first-half production exceeded 193,000 ounces; management reiterated annual guidance and expects stronger second-half output from Sadiola, Bonikro, Agbaou and the Kurmuk startup.
  • Positive Sentiment: Bonikro outperformed its first-half plan on higher grades and throughput, while the Côte d’Ivoire complex is now targeted to produce approximately 200,000 ounces per year for at least 10 years. Agbaou proven and probable reserves increased 60%, supporting the longer mine-life outlook.
  • Positive Sentiment: The company reported adjusted net earnings of $0.44 per share, $133 million in operating cash flow and $192 million of quarter-end cash; including the Zijin Gold investment, pro forma cash is expected to approach $500 million. Management said the stronger balance sheet could accelerate future investment and support a potential dividend policy once cash-flow sustainability is demonstrated.
  • Neutral Sentiment: All-in sustaining costs were below $2,200 per ounce sold, with further reductions expected from higher production, Sadiola process upgrades and solar power initiatives. However, management noted that Sadiola’s next major expansion requires additional engineering, with construction expected during 2027–2028 and production targeted from 2029.
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Earnings Conference Call
Allied Gold Q2 2026
00:00 / 00:00

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Operator

Thank you for standing by. My name is Kathleen, and I will be your conference operator for today. At this time, I would like to welcome everyone to the Allied Gold second quarter 2026 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session, so if you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press the star 1 again. Now I would like to turn the call over to Peter Marrone, CEO. Please go ahead.

Peter Marrone
Chairman and CEO at Allied Gold

Thank you very much, operator, and thank you to all who are participating on this call. As some of our management is remote and for efficiency and also for the cadence of this call, I will present our formal presentation, but management is available on the call to address any questions. We are happy to be back with these conference calls, and given that we have had a hiatus on these calls, we thought it would be helpful to provide a recap of who we are and what we are and where we are going as part of our quarterly results. We are in Mali, we are in Côte d'Ivoire, and we are in Ethiopia.

Peter Marrone
Chairman and CEO at Allied Gold

I begin with a discussion about the jurisdictions in which we operate, as there has been much said about these jurisdictions, but again, we hope to give you comfort that these are jurisdictions that are high quality for mining. Mali is prolific, certainly for precious metals mining. We cannot think of a jurisdiction in which within several hundred kilometers there would be a handful of mines that produce between a couple of hundred thousand ounces of production and as much as half a million ounces of production, and it is very supportive of mining, and it has infrastructure for the support of mining. Côte d'Ivoire is new to the mining circle. However, it is one that has advanced very quickly with significant opportunities and certainly our Côte d'Ivoirean complex with Bonikro and Agbaou add to the successes in the country relating to mining.

Peter Marrone
Chairman and CEO at Allied Gold

Ethiopia is very new to mining, certainly precious metals mining. We are the first mechanized mine of scale that will be in production in the country, but it is on the bottom end of the Arabian Nubian Shield. Much has been said about the Arabian Nubian Shield and its potential, and here we are with millions of ounces already in inventory and literally on the cusp of the startup of operations. I begin with a discussion about jurisdictions mostly as an admonition to the laziness and over penalization of these jurisdictions, particularly for companies that have tier 1 assets as we do. But I also want to make sure that it is clear that this is also a recommendation of the value proposition for discerning investors that are comfortable that we, along with many other companies in these jurisdictions, can manage the geopolitical concerns, manage our operations effectively.

Peter Marrone
Chairman and CEO at Allied Gold

In the context of operations, here we are with Sadiola, a tier 1 generational mine that for two decades has been in production, producing more than 8 million ounces in steady state without any interruption. We have a production platform that carries more than 10 million ounces in resources, is a large mineral inventory with a production platform presently of approximately 200,000 ounces, with a plan to take that to closer to 350,000 ounces over the next several years on a sequential basis. Côte d'Ivoire's two mines, roughly 17, 18 km apart that we treat as a complex. We are targeting a mine life of 200,000 ounces per year for at least a 10-year period.

Peter Marrone
Chairman and CEO at Allied Gold

In the case of Ethiopia, our next mine, the Kurmuk mine, we expect to produce at least 250,000 ounces per year, and we expect that production to begin this quarter. Let me put a fine point to it. When we say this quarter, we're in commissioning in the month of August. We expect to be in production in the month of September. What I think is the true value proposition here is not just the particular assets, but the fact that we are unique in that we are a mid-tier gold producer, but we are underpinned by high-quality assets and in particular, on the opposite sides of the continent in Mali, in the case of Sadiola, and in Ethiopia, in the case of Kurmuk, by two tier 1 generational mines. A unique mid-tier gold producer with two tier 1 mines in the portfolio.

Peter Marrone
Chairman and CEO at Allied Gold

For the second quarter, we had strong performance that carries the momentum into the second half of the year, with higher production expected from operational improvements and of course, the startup of Kurmuk. We are on track to achieve annual guidance from our producing mines. The drivers for Sadiola will be higher feed grade, and throughput increases. In the case of Bonikro, we're ahead in the sequencing in the first half of the year. We expect to see the feed grade to a level that is higher in the second half of the year, and the throughput will vary quarter to quarter, but production will exceed our annual guidance with a fourth quarter production that exceeds the third quarter, and the third quarter is slightly better than Q1 and Q2.

Peter Marrone
Chairman and CEO at Allied Gold

Agbaou is now at a steady state of production, and we expect its production to be consistent with the first and second quarter for the second half of the year. With that, we expect to see cost improvements on what has already been seen as a cost improvement from Q1 to Q2 and from last year to this year. We're advancing our growth project, which is Kurmuk. That's advancing as planned. As I mentioned a moment ago, we are in commissioning, and we expect that to be in production before the end of this quarter.

Peter Marrone
Chairman and CEO at Allied Gold

We have a strong financial position, while we show in this presentation a pro forma cash balance of just under half a billion dollars after giving effect to the Zijin Gold strategic investment, we do end the quarter with more than $190 million in the treasury, more than sufficient to fund the business of this company. We have impressive exploration potential with a budget that is $36 million. We just increased the budget to the second half of the year because of the exploration successes that we experienced in the first half of the year. In terms of our operations, just over 97,000 ounces for the second quarter, just over 193,000 ounces for the first half of the year, and an all-in sustaining cost that is below $2,200 per ounce sold.

Peter Marrone
Chairman and CEO at Allied Gold

In the case of Sadiola, production is expected to increase, as I mentioned, in the second half, that is driven by increased feed grade and throughput. We're targeting to meet our annual guidance. Costs are expected to trend down, driven by higher production and lower expenditures. We continue to progress improvements to lower costs, we're advancing several strategy, one of which will lead to the improvements to costs, which is a power solution that makes us less reliant on older diesel generators, a refresh of those generators, but also applying a solar power solution that will represent a significant portion of power at that operation. In the case of Bonikro in Côte d'Ivoire, our production exceeded our plan for the first half of the year due to higher grades and throughput.

Peter Marrone
Chairman and CEO at Allied Gold

We took on a challenge in 2023 and 2024 through 2025 of waste removal and stripping to get to higher grade material at Bonikro, we said that by 2026 we would be in a position to be meeting our goals of getting that higher level of production, we have demonstrated that we have done that. The same is true for Agba where production is expected to remain constant for the second half of the year, tracking to meet guidance, but at better costs than we had been experiencing in the first half of the year and last year. For the Côte d'Ivoire platform, we've increased mine life that is supported by a new area of mineralization that is now in development. We are advancing further exploration targets. In the case of Agba, we've increased proven and probable reserves by 60%.

Peter Marrone
Chairman and CEO at Allied Gold

We have advanced our projects to the point where, whereas initially we were saying that we expect to get production of 180,000 ounces per year for 10 years, we're now at a point where we can demonstrate that we can get that 10 years of production, but at 200,000 ounces per year. A little bit more on each of the operations. Sadiola, again, a generational asset with significant mine life and mineral endowment. We are in transition from a mine that was reliant on oxide ores to fresh ore. That first phase expansion now allows us to take more than 60%, as much as 70%, of fresh ore through that plant. We're advancing a process of control upgrades, pre-leach thickener to increase efficiency and reduce operating costs. I mentioned the solar power strategy to further improve costs.

Peter Marrone
Chairman and CEO at Allied Gold

We have an organic expansion plan that takes us initially to that 200,000 ounces, as I mentioned, which is where we are now, and then to a production level that is expected to be closer to 250,000-275,000 ounces, and ultimately to a goal of between 300,000 and 350,000 ounces. We are making new oxide discoveries. We are making new discoveries on a platform that's already 10 million ounces of resources, of which more than 7 million ounces is proven in probable reserves. Short term, 200,000-230,000 ounces of production, including this year. That will progressively increase within the next year and a half, and we average a production of in excess of 300,000-350,000 ounces as an average, with several years at closer to 400,000 ounces.

Peter Marrone
Chairman and CEO at Allied Gold

With all-in sustaining costs that are expected to decline significantly, and we estimate in the range of about $1,200 per ounce. We are transitioning from oxide mine to fresh ore. We're putting automation and processes in place. We're upgrading this operation, this plant that is worthy of the tier 1 inventory of ounces that we have. We expect, just to give a bit more clarity, the next step to be to go to 7 million ounces per year. We're working on the engineering for that. It is expected to continue through this year. We expect to be in construction on a permanent second stage crushing and larger ball mill that will proceed through 2027 and 2028, with the start of production in 2029.

Peter Marrone
Chairman and CEO at Allied Gold

We expect then that by 2029, for several years to follow, to be at least at 275,000 ounces per year before we undertake the next modular expansion to 8 million tons, and then above that drives that production to its ultimate goal of above 300,000 ounces, in the average of 350,000 ounces, with several years above 400,000 ounces. In the case of Kurmuk, we're in commissioning. We continue that through this quarter. We expect to be in production, as I mentioned, in September. We are progressing as planned. Ore stockpiles are building, and we're ahead of operations. Our project costs are tracking to budget with over 90% of those costs committed as of the end of the second quarter, and we expect to be on budget and on time with this operation. This makes meaningful improvements to cash flow.

Peter Marrone
Chairman and CEO at Allied Gold

It is a prolific land package that will increase the number of ounces that is inventory. We presently look at 240,000-270,000 ounces of production, with the average over the next several years, 2027-2030, that is closer to 300,000 ounces, with all-in sustaining costs that are expected to be below $1,200 per ounce. Indeed, we expect that to be below $1,000 per ounce given the low power costs that we have at this operation. Moving to Côte d'Ivoire, Agbaou and Bonikro, we treat it as a complex. They're roughly 17, 18 km apart. They offer synergies. We have begun a process of optimizations. As I mentioned at the beginning of this call, we are now targeting 200,000 ounces per year from this complex with a production profile of at least 10 years.

Peter Marrone
Chairman and CEO at Allied Gold

One of the things that drives all of this is this very significant optionality that we have in the exploration opportunities of the company. I hope I can say that the MD&A provides a fulsome description of what we have done with exploration and what we continue to do. We're happy to address any further questions in our Q&A. What are our objectives? In the case of Sadiola, we have a possible super pit. We're extending mine life. We're allowing for an increase in production. We're finding more oxide ounces, we're finding more fresh ore.

Peter Marrone
Chairman and CEO at Allied Gold

In the case of Côte d'Ivoire, what started as a two to three-and-a-half-year mine life is now extended, in the case of Bonikro, in excess of 10 years, and Agbaou is now already at approximately six years, going toward our goal of 200,000 ounces of production for at least a 10-year period. In the case of Kurmuk, we start with two open pits, Dish and Ashashire, but we have many areas of exploration that will represent their own open pits. The objective is to extend mine life, to provide operational flexibility with more mining areas, and to take advantage of that plant capacity that we said in our earlier calls is in excess of what we need at present time.

Peter Marrone
Chairman and CEO at Allied Gold

In terms of second quarter financial performance, adjusted net earnings of $0.44, operating cash flow of $133 million, Adjusted EBITDA of just under $167 million, all-in sustaining costs of just under $2,200 per ounce, and cash in the treasury of $192 million, and pro forma with the completion of the Zijin transaction expected to be just shy of half a billion dollars. We are an established mid-tier producer. We have large-scale, long-life assets, those generational assets to which I referred. We have a project pipeline that creates a notable, very significant production growth that contributes more handsomely to cash flow growth, because all these new ounces are coming in at significantly lower costs. We take a disciplined approach to development and production growth with operational improvements that drives sustainable value creation. Just to conclude the presentation, we are on the cusp of that notable growth.

Peter Marrone
Chairman and CEO at Allied Gold

We have strengthened the operational performance of the company. We have delivered and are delivering on our growth projects. We have improved the sustainability framework of the company. We are in a strong financial position. We have increased mine life at Côte d'Ivoire, which was the lowest mine life that we had, but of course, at the other operations as well. We have further growth initiatives that will be supported by the exploration successes that we are achieving. We're trading at a very attractive valuation. We received an offer to sell the company in January for $44 per share. Today, many months later, we're a more advanced and a better company. We have delivered on our plans that improve the company and increase that value. I'm comfortable saying to everyone on this call that we present a unique and strong value proposition.

Peter Marrone
Chairman and CEO at Allied Gold

In terms of upcoming milestones, the startup of operations at Kurmuk, a further exploration update in the fourth quarter, further advancement and what we will say about the Sadiola next phase expansion by the first quarter of next year. We expect a site visit of our Kurmuk operation for sure in the first quarter of 2027. We're completing the steps that are required at Sadiola, including the installation of the pre-leach thickener and the power solution, including solar, that will improve that operation for the next phase of our modular expansion. Finally, the startup of operations and ramp up at Kurmuk. No, I did not make a mistake there. I duplicated the point for a reason. We're at the startup of operations at Kurmuk, which transforms this company in terms of production and in terms of cash flows.

Peter Marrone
Chairman and CEO at Allied Gold

With that, ladies and gentlemen, let me open the call to questions.

Operator

Thank you. We will now begin the question and answer session. If you have dialed in and would like to ask a question, please press star one on your telephone keypad and raise your hand to join the queue. If you would like to withdraw your question, simply press the star one again. If you are called upon to ask your question and listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Again, please press star one to join the queue. Your first question comes from the line of Ralph Profiti of Stifel. Please go ahead.

Ralph Profiti
Ralph Profiti
Analyst at Stifel

Thank you, operator. Good morning. Thanks for taking my questions. Peter, can I ask about some of your recent experience in Mali on the ability to repatriate capital in and out of the country and how, if any, has there been influence on sort of in-country capital allocation decisions?

Peter Marrone
Chairman and CEO at Allied Gold

The in-country capital allocations decisions, Ralph, have been based on prudent business practices and prudent business decisions. It is not the result of restrictions on our ability to repatriate capital. None of that. Again, I am glad you are asking the question because that goes to the fundamental theme of the quality of jurisdiction. There are no restrictions on repatriating capital. We have flexibility in how we mine. We have a large volume business. Mining is a large volume business. Some of you on the call have heard me say that when you are bringing to site more than 100 fuel tankers per month for our fuel requirements, that is a big volume business. A big volume business like that cannot function if we were to accept what is said about the country on the headlines. The headlines are not correct.

Peter Marrone
Chairman and CEO at Allied Gold

This is a functioning country with functioning businesses. One of those businesses is ours. To answer your specific question, we have no restriction in terms of repatriating of capital. We have a business plan to invest back into the country, to invest back into Sadiola, to demonstrate that this is a tier 1 mine.

Ralph Profiti
Ralph Profiti
Analyst at Stifel

Okay. Thank you for that. As a follow-up, Peter, when I look at the 2027, I guess, preliminary guidance for Kurmuk, it looks to be a very efficient flow sheet with that type of production target. I am just wondering, what has been your team's experience and what can we expect on their feedback on how long it is going to take to substantially reach long-term target recoveries and things like operating costs, that initial six to nine months of ramp-up. What does that look like in terms of quality and grade of that initial feed into the plant to get us to that target or somewhere near it?

Peter Marrone
Chairman and CEO at Allied Gold

Ralph, there is nothing unconventional in the design here. It is an open pit. We have opened up the ore. We have stock pilot surface. We are meeting the grade expectations. We do not see any challenges on recoveries. While the ramp-up is within that range of four to six months, we are also blessed with higher grade up front. One of the reasons why we have not said what we expect the production level to be this year is a positive, not a negative. We expect to produce, because of grade, 30,000 ounces per month. That is why in the first handful of years, we have a production platform that is at or close to 300,000 ounces per year, not the average of 240,000 ounces per year.

Peter Marrone
Chairman and CEO at Allied Gold

That also means that if we're in production in early September to mid-September to late September, we expect to be in that range of early to mid-September. That will make a difference in terms of what the production is for this year, but not to the value and not to the number of ounces of production next year and in the years to follow. We are blessed with grade that is higher, closer to surface. We have a ramp-up that I believe to be on the conservative side. The result of grade, the result of what we see in recoveries, the result of that gradual ramp-up gives us a high confidence level that we'll meet the production goals that we expect, that we've indicated for next year and in the years to follow.

Ralph Profiti
Ralph Profiti
Analyst at Stifel

Okay. Thank you for those important answers.

Operator

Your next question comes from the line of Luke Bertozzi of CIBC. Please go ahead.

Luke Bertozzi
Luke Bertozzi
Analyst at CIBC

Thank you, operator. Good morning, Peter and team. Congrats on the quarter. A really standout job in Côte d'Ivoire. I just had a question on Kurmuk. Can you provide a bit of an update on how the mining activities are going, in particular, how is it reconciling with the block model? Perhaps if you could give a little bit of details on the grade and quantity of your stockpile.

Gerardo Fernandez
Chief Development Officer at Allied Gold

Okay. Hi, Luke. This is Gerardo. In terms of reconciliation, we're doing really well. We updated that model several months ago in anticipation of the start of operations. We did delineation drilling, and we're really pleased with the results in terms of grade control reconciliation. We're tracking well also on the volumes. We have reached the high-grade zones at both Dish Mountain and Ashashire, and we're quickly building the stockpile on high grade. We have three categories or main categories of grade, and that we will be using, as Peter was describing, for the ramp path as we are increasing the throughput through the plant.

Luke Bertozzi
Luke Bertozzi
Analyst at CIBC

Thanks, Gerardo. Just a follow-up question there. Previously, you guys had identified the state build transmission line as a key milestone for the startup timeline. Can you comment on the status of that grid power connection today?

Peter Marrone
Chairman and CEO at Allied Gold

Luke, we mentioned that not as a gating item or as a critical path item. We mentioned it because we have a 20-year power purchase agreement of $0.04 per kWh. For the benefit of those on the call, that's one half of what one pays in Quebec. It is one quarter of what one pays in Canada, all of which is hydroelectric power. We're trying to highlight that this is one of the factors that allows us to be able to get production at the very low cost that we're anticipating. The power line will be up and running for us to be in production. We want to make sure that it's clear, we need full power by November, not by September. We're perfectly on track to be with power by September.

Peter Marrone
Chairman and CEO at Allied Gold

Whatever we need by November is not expected to be a gating item, not expected to be a critical path item, because we expect to have power in September. We also have backup power generators. The result of all of that is that we do expect to be in production in September. This is not a gating item for us.

Luke Bertozzi
Luke Bertozzi
Analyst at CIBC

Yep. Great. Thanks, Peter. Appreciate the clarification there. Looking forward to the next quarter. Thanks, guys.

Peter Marrone
Chairman and CEO at Allied Gold

We're looking forward to having you and others, if your time permits, on our mine tour that we're planning sometime, as I mentioned, in the first quarter. I think this asset will show very well.

Operator

Your next question comes from the line of Carey MacRury of Canaccord. Please go ahead.

Carey MacRury
Carey MacRury
Analyst at Canaccord

Hi. Good morning, Peter. Just wondering if we can come back to Kurmuk and just if you can talk a little bit about sort of what the major items left are to complete there.

Gerardo Fernandez
Chief Development Officer at Allied Gold

Hi, Carey. It's Gerardo again. We are busy on C1 and advancing C2 and then getting, as you probably saw in the pictures, on also wet commissioning some units. There is some instrumentation on mostly terminals and cable to pull in certain areas. As we are moving through those, we are also advancing the commissioning. Big focus on that. All the ancillary items are finished or substantially finished. I am talking about the TSF that was finished, water dam finished. Main haul road is almost finished. It is usable now, and we have other access, as you know. All key things are coming together. Crushing will be operational pretty soon, and I think it is substantially complete, and we expect to start crushing rock in the next few days, few weeks.

Carey MacRury
Carey MacRury
Analyst at Canaccord

Coming back to grade, you mentioned the three categories of grade. Just wondering, just for our benefit, how you classify high grade at Kurmuk.

Gerardo Fernandez
Chief Development Officer at Allied Gold

I think we are over 1.5, if I recall correctly, and between one and 1.5. If you look at the life of mine profile and the technical report, you will see what grade is available in the beginning and how that changes. We are following that profile. We expect to follow that profile quite closely.

Carey MacRury
Carey MacRury
Analyst at Canaccord

Great. Maybe one for Jason if he is on the line. You had a big cash tax bill in the quarter. Just wondering how we should think about cash tax instead of back half of the year.

Jason LeBlanc
CFO at Allied Gold

Yeah, Q2 is always our big cash payable quarter, Ralph. It's just the profile of the jurisdictions that we operate in. That 75% of our total cash tax for the year was in Q2. I don't know, maybe it's $15 million-$20 million per quarter going out here.

Carey MacRury
Carey MacRury
Analyst at Canaccord

Okay. That's it for me. Thanks, guys.

Peter Marrone
Chairman and CEO at Allied Gold

Jason, our cash taxes were at the level that they were at because we were profitable last year, and so we're paying more taxes for the profitability.

Jason LeBlanc
CFO at Allied Gold

Exactly, yeah.

Operator

Once again, if you wish to ask a question, please press star one to join the queue. The next question comes from the line of Mohamed Sidibé of National Bank. Please go ahead.

Mohamed Sidibé
Mohamed Sidibé
Analyst at National Bank

Hi, Peter and Tim. Thanks for taking my question. Maybe just a follow-up on the comments you made on grade, Peter. Did I understand correctly that the potential update on Kurmuk could be actually on the positive due to the higher grades that we could be expected compared to plan, or did I misunderstand that? Thank you.

Peter Marrone
Chairman and CEO at Allied Gold

What we are saying is that because the production profile on a month-to-month basis because of the higher grade closer to surface at Dish and Ashashire, the two initial deposits, it's difficult to say to the end of the year if we expect to produce 80,000 ounces or 100,000 ounces or 120,000 ounces. If we're in production in early September, 30,000 ounces per month gets us to a point of 120,000 ounces. That's what we were trying to say, and nothing more than that.

Mohamed Sidibé
Mohamed Sidibé
Analyst at National Bank

Perfect. Thank you. Just a follow-up on Kurmuk there, understanding that the power line is not critical. I think you noted in your MD&A that the power line should effectively meet the start of the ramp-up at the asset there. Should we assume that you have enough diesel gen set and fuel capacity on site to mitigate any potential delay there?

Peter Marrone
Chairman and CEO at Allied Gold

We have sufficient supplies for us to be in production this quarter.

Mohamed Sidibé
Mohamed Sidibé
Analyst at National Bank

Okay. Final question on your balance sheet, following the investments from Zijin. When we're looking at your balance sheet in Q3, how should we think about your capital allocation priorities into 2027? Is this more of a potential acceleration to Phase II at Sadiola or maybe initiatives in Ivory Coast? Is it potentially to free up capital towards some capital return program? How should we think about this?

Peter Marrone
Chairman and CEO at Allied Gold

Look, think of it as all of the above. With the balance sheet that we have organically, the expectation is that cash flows will have to build into cash balances before we're in a position. Deploying that capital in 2027 for what we expect to do at Sadiola for 2029-2032, as I mentioned, that 275,000 ounces plus production. Expect to deploy capital, we will build out the cash balances. With the excess of cash flows above what we are spending, we would expect, as we have done before, as we've said before, we're implementing a dividend policy. The best way to look at the supercharge that comes from this transaction is that the cash balances have built up before we build them up organically.

Peter Marrone
Chairman and CEO at Allied Gold

Any prudent board of directors will want to build up cash balances and demonstrate cash flow and the sustainability of that cash flow before it will concede to providing a dividend. I'm a big believer in dividends. I'm a big believer, as you know, in the provision of cash returns to investors, dividends are an excellent way to do that. It attracts a type of investor that we want to have in our business and in our company. The result of all of that is that this acts as an accelerant to all of that. I cannot say to you that we will advance the projects more quickly because that requires the discipline of making sure that we've done the detailed engineering as we said in our MD&A we're doing.

Peter Marrone
Chairman and CEO at Allied Gold

Once we've completed that engineering, we're in a better position to be able to say, "This is what we intend to do." It's more sustainable. It's more precise. I don't think that we would be advancing the projects that we have as a result, and particularly the Sadiola second phase modular expansion. It gives us the flexibility to look at other things, and one of which, as you mentioned, is cash returns to investors sooner.

Mohamed Sidibé
Mohamed Sidibé
Analyst at National Bank

That was a great call. Thanks a lot for answering my questions.

Operator

There are no further questions at this time. I will now turn the conference back over to Peter Marrone for closing remarks.

Peter Marrone
Chairman and CEO at Allied Gold

Ladies and gentlemen, my apologies for my voice. I am suffering a little bit of the back end of a cold. Thank you very much for the time. We are happy to be back on these conference calls, and we look forward to further updates throughout the course of the rest of the year. Clearly the most important, as I mentioned on the formal presentation, being the startup of operations at Kurmuk, we do look forward to seeing you with our Q3 conference call and then with the end of year. Thank you again.

Operator

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Executives
    • Peter Marrone
      Chairman and CEO
    • Gerardo Fernandez
      Chief Development Officer
    • Jason LeBlanc
      CFO
Analysts
    • Ralph Profiti
      Analyst at Stifel
    • Luke Bertozzi
      Analyst at CIBC
    • Carey MacRury
      Analyst at Canaccord
    • Mohamed Sidibé
      Analyst at National Bank
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