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Article Excerpt
OPERATOR: Welcome to the HudBay Minerals proxy circular briefing update conference call. (Operator Instructions) Following the presentation, we will conduct a question-and-answer session. I'd like to remind everyone that this conference call is being recorded today, Monday, March 16, 2009.
And now, I would like to turn the conference over to Ms. Annemarie Brissenden, Manager of Investor Relations. Please go ahead.
ANNEMARIE BRISSENDEN, MANAGER OF IR, HUDBAY MINERALS INC: Thank you, Patrick. Good morning and welcome to HudBay's conference call, in which our Interim CEO, Colin Benner, will review HudBay's Corporate strategy and answer questions about his interim appointments. Also in attendance for this meeting, is Mr. Michael Winship, HudBay's President and COO; and Mr. David Bryson, HudBay's Senior Vice President and CFO. Our conference call is being Webcast on HudBay's Website and will be available for replay there until March 25, 2009.
Please note, that comments made on today's call may contain forward-looking information. 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. These documents are also available on our Website at hudbayminerals.com. And now, I'd like to pass the call over to Colin.
COLIN BENNER, INTERIM CEO AND DIRECTOR, HUDBAY MINERALS INC: Thank you, Annemarie. Good morning. And ladies and gentlemen. I was appointed, as most of you know, as Interim CEO about a week ago. And now, that I've had the opportunity to spend some time with the management team, I'd like to share my thoughts on the Company and the strategy that the Board, in conjunction with management for HudBay, has developed. The main message is principally, as you know, all the world is in a period of economic turmoil, the likes of which none of us have ever seen before. The looming question is; How long will it take to recover? And more specifically, in our space, the base metal space; How long will it take for the base metal sector to recover? My opinion is that it will take three to five years. And I believe it will largely depend on China and to a lesser extent, India and their appetites for base metals.
Having said this, I believe the best approach throughout this time that we can take, in moving forward, is to plan for the worst and hope for the best. HudBay has CAD686 million in its treasury and no debt. And is in a good position to weather the economic storm. The challenge for us is to grow the Company while ensuring that we keep the plants full with feed and while protecting the Company's cash. And protecting the cash is necessary, as we will require it over the ensuing three to five year period to sustain operations, develop advanced projects and continue with our exploration.
Further, the Company no longer has the umbrella of the tax losses, which allowed for the substantial buildup of cash during the period of robust metal prices, 2005 to 2008. These were losses, I might add , that were accumulated prior to the incredible run-up in the metal prices in this period, when HudBay really made money. The question is; How do we meet this challenge while growing the Company in an accretive manner?
By "growing," we mean seeking diversification and ensuring that there are additional projects or operations to provide a stable production profile and a competitive cost profile to assure profitability. The answer to this question is obviously not simple. We have to be mindful of the possibility that the metal prices, and in particular, zinc, may stay at today's level or perhaps even go lower. And our strategy must be three-pronged.
One, we must continue to optimize our operations. Two, we must continue to grow organically. And three,...
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