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Andrew Pardey - COO

Pierre Louw - CFO

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David Haughton - BMO Capital Markets

Centamin Egypt Limited (OTCPK:CELTF) Q2 2013 Results - Earnings Call Transcript August 14, 2013 9:00 AM ET

Operator

Thank you for standing by and welcome to the Q2 and Half year results conference call. At this time, all participants are in a listen-only mode. There will be a question-and-answer session. (Operator Instructions) I would now like to hand the conference over to your speaker today, Andy Davidson. Please go ahead, sir.

Andy Davidson

Thanks very much and hello all and thanks for joining the call. I am joined by Chief Operating Officer, Andrew Pardey and our CFO, Pierre Louw and so we're here and ready to take your questions. Thanks very much. Operator, are you there?

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from David Haughton. Please ask your question.

David Haughton - BMO Capital Markets

Just having a look at the CapEx you can see that a big amount of the expansion already done you’ve indicated another 25 million to be spend this year, but want to understand what is the CapEx expectation in total for the balance of the year?

Andrew Pardey

Hi David, the presentation which is on the website, slide 16 and 17, the slide 16, because your breakdown is what we spend so far to date by the various cost centers and slide 17 is the expectation for the full year total. So we’ve clearly got another 25 million less on page four, the bulk of that will be through the reminder of the second half. If you are on the page four, the expense of the mining fleets, as we previously said the overall budget for that was $65 million and we expect to stay in the region of about $45 million this year on that.

David Haughton

And how much have you spend of that 45 so far this year?

Andrew Pardey

That’s round about 30 million as you see on slide 16, says 7.2 million in the first quarter and 23.7 in the second quarter.

David Haughton

Okay. So instead of me bouncing from slide to slide and backward and forth and trying to work out what's what. For the CapEx remaining you got 25 million for the expansion, you’ve got another 20 million for the fleet, you got another what 22 million is it for the underground left to go?

Andrew Pardey

22 million for the full year, we spend around about of half of that we are half way through that.

David Haughton - BMO Capital Markets

Okay so it’s 14. Okay you got you are sustaining so 30 for the whole year you have spend 14 so far so 16 to go.

Andrew Pardey

Correct yeah.

David Haughton - BMO Capital Markets

Okay. So 25 plus 20 plus 14 plus 16 that’s 75 million to remain is that math sound right?

Andrew Pardey

Yeah that’s right David.

David Haughton - BMO Capital Markets

Okay, just wanted to get to the bottom of that. And then what do you think would happen for next year then most of your expansions done, your fleet is done, you’ve have still got some ongoing underground development to go. What would your expectation be into next year, would it be considerably large, do you think?

Andrew Pardey

Dave that will be remaining what the open pit mining fleet expansion won’t be completely done. Let’s say the total budget for that is $65 million. So it’s like 20 million less for next year. But beyond that yeah you are into steady state really beyond that there will be round about 25 million for the underground and round about 30 million per annum from sustaining CapEx ongoing. So those are the two major contributors to CapEx on an ongoing basis.

David Haughton - BMO Capital Markets

That’s 75 round about. And even post expansion you are happy with that 30 as your ballpark sustaining number?

Andrew Pardey

Sorry, say again David.

David Haughton - BMO Capital Markets

Sorry, post expansion, you are happy with 30 million per annum is reasonable sustaining number?

Andrew Pardey

Yeah, that’s the number we are working on; we are comfortable with that number.

David Haughton - BMO Capital Markets

Okay and exploration see on page 17, you got 15 million there, is that also capitalized?

Andrew Pardey

It is at this time?

David Haughton - BMO Capital Markets

Okay, so should I include that in the 2013 number a portion of that for the remainder of year?

Andrew Pardey

Yes, correct David.

David Haughton - BMO Capital Markets

Okay, so maybe half of that?

Andrew Pardey

Yeah, half of that.

David Haughton - BMO Capital Markets

All right, it sounds all good. And now having a look at the recoveries, so your commentary not 90% you have done quite a bit of work to get up there. Is that something that you are still comfortable with on a going forward basis, that you should have a nine handle instead of eight handle on your recovery?

Andrew Pardey

We are confident now, of being able to maintain that recovery to the rear of 90%. We’ve done a lot of work in various areas (inaudible). I have done some modifications to increase the resident time, so we can maintain those recoveries ability. So it will be additional (inaudible) which will come going for settlement stage before it comes on line hence for the reason for the new carbon (inaudible).

David Haughton - BMO Capital Markets

Thanks, Andrew. And underground rate was pretty good, your 11 grams. Is that just sort of the sequencing that you’ve got or you feel that we should be taking that as something that could be a change going forward as well?

Andrew Pardey

Around is great. Around 10 grams a ton you can look at for the underground going forward.

David Haughton - BMO Capital Markets

Alright. So I'll let someone else have a go now, thank you guys.

Operator

Thank you. (Operator Instructions) There are no further questions at this time. Mr. Davidson please continue.

Andy Davidson

Well, it's okay. Because David got everyone's question in one go that’s great. So thank you all for listening in and joining the call. We look forward to speaking to you next time. Thank you. Bye

Operator

That does conclude our conference for today. Thank you for participating. You may all disconnect.

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