Avino Silver & Gold (ASM) Q3 2026 Earnings Call Transcript

DATE

Thursday, Nov. 5, 2026

CALL PARTICIPANTS

• Head of Investor Relations - Jennifer North
• President and Chief Executive Officer - David Wolfin
• Chief Financial Officer - Nathan Harte
• Chief Operating Officer - Carlos Rodriguez
• Senior Vice President Technical Services - Peter Latta
• Senior Vice President of Corporate Development - Marc Turcotte

TAKEAWAYS

• Revenue -- $33.4 million, representing a 59% increase compared to the third quarter of 2025 due to higher realized metal prices and increased silver output.
• Average Realized Silver Price -- $63.33 per silver ounce, reflecting a 66% increase from the prior year period.
• Silver Production -- 303,189 ounces, representing a 15% year-over-year increase driven by growing contributions from La Preciosa.
• Gold Production -- 1,732 ounces, reflecting a 10% decrease compared to the third quarter of 2025.
• Copper Production -- 1,202,821 pounds, representing an 8% decrease from the third quarter of 2025.
• Silver Equivalent Production -- 582,836 ounces, reflecting steady operational performance across processing facilities and increased development material from La Preciosa.
• Gross Profit Margin -- 44%, inclusive of non-cash items, though impacted by a stronger Mexican peso and accelerated mine preparation costs.
• Net Income -- $6.1 million, or $0.03 per diluted share, compared to $7.7 million in the third quarter of 2025.
• Adjusted Earnings -- $14.3 million, or $0.08 per share, representing a 23% increase year over year.
• Operating Cash Flow -- $12.7 million, a 52% improvement compared to the third quarter of 2025.
• Free Cash Flow -- $6 million, excluding La Preciosa exploration and development costs but including all capital spend at the Avino Mine.
• Cash Position -- $138 million as of Sept. 30, 2026, representing a strong liquidity position net of a final $8.75 million royalty extinguishment payment.
• Working Capital -- $142 million, representing an increase from $99.6 million at the end of 2025.
• La Preciosa Mining Rate -- exceeding 450 tons per day during the quarter, with over 3,000 meters of underground development completed year to date.
• Avino Mine Production -- 477,000 silver equivalent ounces, supported by investments in equipment automation and operational efficiency.
• La Preciosa Production Volume -- 106,000 silver equivalent ounces from development material, a 5% increase compared to the second quarter of 2026.
• Full Year Production Guidance -- 2.2 million to 2.5 million silver equivalent ounces, revised from previous estimates due to mine sequencing and the processing of lower-grade material.
• Cash Cost Guidance -- $22 to $24 per silver equivalent ounce, updated from the previous range of $19 to $21 per ounce.
• AISC Guidance -- $30 to $32 per silver equivalent ounce, revised from the prior range of $25 to $27 per ounce.
• AISC per Tonne Guidance -- $85 to $95 per tonne processed, reflecting more development tons being processed than initially forecasted.
• Consolidated AISC per Tonne -- $90.52 in the third quarter, representing a 22% increase compared to the third quarter of 2025.
• Avino Mine Cash Cost per Tonne -- $59.60, remaining below the company's guidance midpoint for the quarter.
• Capital Expenditures -- $15 million for the first nine months of the year, focused on mine development and equipment for future production at La Preciosa.
• Share Repurchases -- over 1 million common shares cancelled since the approval of the normal course issuer bid in April 2026.
• Total Workforce -- more than 700 employees and contractors, including 580 at the Avino Mine and 127 at La Preciosa.

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RISKS

• Nathan Harte stated, "the Mexican peso strength had a negative impact on our margins, with the peso averaging between 7% and 10% stronger compared to the U.S. dollar this quarter versus Q3 of 2025," noting that currency fluctuations pressured financial results.
• David Wolfin noted that "grades remained below plan" for La Preciosa development material, which contributed to revised production expectations for the full year.

SUMMARY

Management reported consolidated performance for the quarter, highlighting a transition toward production mining at La Preciosa and the maintenance of operational efficiencies at the Avino Mine. The company stated that financial results were influenced by significant silver price appreciation and strategic investments in underground development. Management indicated that the long-term objective involves reaching annual production of 10 million silver equivalent ounces through existing infrastructure expansion and the scaling of newer assets. Avino Silver & Gold Mines Ltd. (NYSEMKT:ASM) reported that mine operating cash flow before taxes rose 49% to $16.5 million, reflecting the delivery of meaningful cash flow even during a multiyear expansion phase.

• The company was named to the TSX 30 for the second consecutive year, with a share price appreciation of approximately 958% over the three-year period ended June 30, 2026.
• Peter Latta stated, "the stopes at La Preciosa are both wider and higher grade than what we typically thought," based on recent infill drilling results not yet included in current reserve estimates.
• Engineering and technical studies are evaluating the potential for a standalone processing facility at La Preciosa to support long-term production scaling.
• Management is implementing mechanical improvements and new equipment scheduled for commissioning in the first quarter of 2027 to enhance silver and gold recoveries.
• The exploration program remains on track to complete 15,000 meters of drilling at both La Preciosa and the Avino Mine by the end of the year.
• Nathan Harte noted that while the Mexican peso was a headwind in the third quarter, the U.S. dollar has strengthened approximately 15% since the quarter ended, potentially providing tailwinds in the fourth quarter.

INDUSTRY GLOSSARY

• AgEq: Silver equivalent, a metric used to express the combined value of different metals in terms of silver ounces based on established budget price ratios.
• AISC: All-in sustaining cost, a non-GAAP financial measure that includes production costs plus capital expenditures required to maintain current operations.
• Dry-stack Tailings: A method of tailings management where waste material is filtered to a low moisture content and stacked, reducing environmental risk.
• ESR Distinction: A recognition for socially responsible companies in Mexico, which the company has received for four consecutive years.
• Footwall Breccia: A geological zone located beneath a vein or ore body, often targeted for exploration drilling to find extensions of mineralization.
• Infill Drilling: Drilling conducted between existing holes to provide more detail and increase confidence in the mineral resource model.
• PFS: Preliminary Feasibility Study, a comprehensive study used to determine the technical and economic viability of a mineral project.
• TSX 30: An annual ranking of the 30 top-performing stocks on the Toronto Stock Exchange based on dividend-adjusted share price appreciation.

Full Conference Call Transcript

Operator: Good day, ladies and gentlemen, and welcome to the Avino Silver & Gold Mines Third Quarter 2026 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 and 0. I would now like to turn the conference over to Jennifer North, Head of Investor Relations. Ma'am, please go ahead.

Jennifer North: Thank you, operator. Good morning, everyone, and welcome to Avino's Q3 2026 earnings call and webcast. You may join today with a link in our news release, which was disseminated yesterday afternoon and can also be found on our website under Investor Center, then News and Media. In addition, a link can be found on the homepage of the Avino website. The full financial statements and MD&A are now available on our website under the Investor Center tab, then Reports and Financials. In addition, the full statements are available on Avino's profile on SEDAR+ and on EDGAR.

Before we get started, I remind you to view our precautionary language regarding the forward-looking statements and the risk factors pertaining to the statements, and note that certain statements made today on this call by the management team may include forward-looking information within the meaning of applicable securities laws. Forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that may cause the actual results to be materially different than those expressed by or implied by such forward-looking statements. For additional information, we refer you to our detailed cautionary note in the presentation related to this call or in yesterday's press release.

On the call today, we have the company's President and CEO, David Wolfin, our Chief Financial Officer, Nathan Harte, our Chief Operating Officer, Carlos Rodriguez, our Senior Vice President Technical Services, Peter Latta, and Marc Turcotte, Senior Vice President of Corporate Development. I would like to remind everyone that this conference call is being recorded and will be available for replay later today. The replay information and the presentation slides from this conference call and webcast will be available on our website. Also, please note that all figures stated are in USD unless otherwise noted. Thank you. I will now hand over the call to Avino's President and CEO, David Wolfin. David?

David Wolfin: Thanks, Jen. Good morning, everyone, and welcome to Avino's Third Quarter 2026 Earnings Call and Webcast. Today, we will review the highlights of our operational and financial performance, discuss the progress made across our assets, and provide an outlook on our near-term priorities. We will then open the call for questions. I'll begin with an overview of our operational performance and key developments during the quarter before turning the call over to Nathan Harte, Avino's CFO, to review our financial results. Please turn to slide five for operational highlights. During the quarter, Avino continued to build on the progress achieved throughout the year, advancing our growth strategy while maintaining a strong focus on operational discipline and long-term value creation.

Our performance was highlighted by a 15% year-over-year increase in silver production, growing contributions from La Preciosa and steady mill performance at the Avino Mine. At La Preciosa, development activities continued to advance, with mining and processing rates exceeding 450 tons per day during the quarter. With over 3,000 meters of underground development completed, we are approaching an important transition towards production mining at the La Gloria and Abundancia veins. Development and mine preparation work on level 3 is nearing completion, positioning us to begin long-hole production mining. The transition is expected to provide access to higher-grade material compared with the development ore processed to date.

Mill circuits one and two have been processing La Preciosa development ore for two quarters, following earlier-than-planned availability of circuit number 2 during the second quarter. This additional processing capacity has supported increased contributions from La Preciosa. As we prepare for the next phase of mining, engineering and technical studies remain ongoing to evaluate optimal mining, hauling, and processing rates over the longer term. We continue to look at the best way to support future production growth at La Preciosa, including the potential for a standalone processing facility, while making the most of our existing infrastructure at Avino. At the Avino Mine, our focus remains on operational efficiency, disciplined cost management, and maximizing the value of our existing infrastructure.

Investments in equipment, automation, and processing equipment continue to support the reliability and flexibility of our operations while providing a strong operating foundation as we advance our broader growth strategy. Turning now to exploration. Exploration remains an important component of our strategy, with active drilling programs underway at La Preciosa and the Avino Mine. At La Preciosa, we added a third drill during the quarter and remain on track to complete our 15,000-meter exploration program by year-end. The program has progressed from infill drilling towards exploration and step-out drilling, targeting high-priority areas along vein intersections and projections.

Last week, we announced encouraging results from our latest round of infill drilling at La Preciosa, which continue to support our view of the project's geological potential. These results provide further evidence that the La Gloria and Abundancia vein structures may be wider and contain higher grades than previously interpreted in certain areas. Importantly, none of the recently reported drill holes, together with the majority of holes drilled in 2025, were incorporated into our current mineral reserve and mineral resource estimates. In addition, much of the exploration drilling has targeted areas outside the existing resource model.

We believe these results reinforce the opportunity to further define and potentially expand the mineralized system as we continue to evaluate higher tonnage mining scenarios at La Preciosa. At the Avino mine, exploration also continued during the quarter, with two drills deployed to further evaluate the extent and characteristics of the mineralized system. Drilling has focused on upper eastern portion of the system, as well as extension targets within the footwall breccia zone. We also remain on track to complete 15,000 meters of the planned drilling at the Avino mine. Together, these programs represent an important investment in the longer-term potential of both assets, supporting our understanding of the mineralized systems and providing opportunities for future resource growth.

Moving to slide six, we turn to our consolidated third quarter production results, which were released on October 15th. Production of 303,000 silver ounces, just under 2,000 ounces of gold, 1.1 million pounds of copper, for a total of 583,000 silver equivalent ounces, with total mill feed of approximately 190,000 tons. These results reflect steady operational performance across our processing facilities, with an increase in contribution from La Preciosa development material. Silver production increased 15% compared with the third quarter of 2025, reflecting the continued importance of silver in our overall production profile. On slide seven, we highlight production contributions from Avino and La Preciosa.

At the Avino mine, production of 477,000 silver equivalent ounces, and at La Preciosa, development production increased 5% compared with the second quarter, contributing approximately 106,000 silver equivalent ounces, consisting of 91,000 silver ounces and 166 gold ounces. Year-to-date processing of mineralized development material from La Preciosa exceeded our plan, primarily due to the earlier-than-scheduled availability of mill circuit number 2 during the second quarter. While grades remained below plan, elevated silver prices supported the economic processing of additional lower-grade development material. The continued advancement of La Preciosa alongside the established production base at the Avino mine remains central to our strategy of building a larger multi-asset silver producer.

Turning to slide eight for corporate highlights, we were very pleased to announce in September that Avino was named to the Toronto Stock Exchange 2026 TSX 30 for the second consecutive year. Avino once again ranked fifth among top-performing companies on the TSX based on dividend-adjusted share price appreciation over the three-year period. For the three years ended June 30th, 2026, Avino's share price increased approximately 958%, representing approximately $1 billion in market capitalization growth. Over the period, we have strengthened our financial position, advanced La Preciosa, established our inaugural mineral reserves, and continued investing in long-term potential of our operations in Mexico.

At this time, I will now hand it over to Nathan Harte, Avino's CFO, to review our financial performance for the third quarter. Nathan.

Nathan Harte: Thank you, David. Here on slide nine, we have an overview of some key financial and operating highlights, with the full table of results on the next slide. In the third quarter, we generated revenues of $33.4 million, with 55% of our revenues coming from silver ounces sold at an average realized price of $63.33 per silver ounce. Gross profit margin was 44%, inclusive of non-cash items, and 49% on a cash basis, excluding depreciation and depletion. Our gross profit margin was impacted this quarter primarily by a weakened U.S. dollar against the Mexican peso, as well as additional mine preparation costs at La Preciosa to accelerate development.

Despite these headwinds, Avino earned $6.1 million in net income, or $0.03 per diluted share, with adjusted earnings coming in at $14.3 million, or $0.08 per share. Operating cash flows and free cash flows are both improved compared to Q3 of last year. We generated operating cash flows of $12.7 million, a 52% improvement from Q3 of last year. This amounted to operating cash flows per share of $0.07. Free cash flow generation was $6 million, excluding La Preciosa exploration and development costs. This figure includes all the exploration and capital equipment spend at Avino. Moving to liquidity and treasury, our cash position remained strong at $138 million at the end of the quarter, and working capital was $142 million.

These amounts are net of the final $8.75 million payment made in the quarter to extinguish the royalties that were originally issued as part of the acquisition of La Preciosa. Coming to slide 10, we see all other financial metrics for the third quarter and year to date. As everyone can see, almost all categories saw meaningful increases, highlighting again the continued free cash flow generation coming from Avino, which is more than covering all costs of development at La Preciosa as we continue the transition to production mining methods. Here on slide 11, we have an overview of operating results on a per-ounce and per-ton basis, as well as the margins at our operations.

As noted previously, the Mexican peso strength had a negative impact on our margins, with the peso averaging between 7% and 10% stronger compared to the U.S. dollar this quarter versus Q3 of 2025. On the flip side, the U.S. dollar has now strengthened by approximately 15% since the end of the third quarter, which should provide for some tailwinds in our fourth quarter, assuming these rates hold steady. In the quarter, we did see some improvements in cost per ounce and cost per ton at Avino, as both saw decreases in Q3 compared to Q2.

Avino's cost per ton is now back in our guidance range for both cash costs and all-in sustaining cash cost per tons as a result of considerable effort from our operations team, who have been facing headwinds with increases in consumables and energy costs being seen across the industry. At La Preciosa, we saw an increase in cost per ounce and per ton for a few different reasons. This quarter, La Preciosa development was over 30% higher than originally budgeted due to additional equipment and increased productivity.

With these additional development and mining preparation costs, as well as our decision to continue processing lower-grade material due to the elevated silver prices, we again want to remind the investment community that these costs for La Preciosa are not indicative of long-term cost per ounce and per ton expectations. This material is development grade running through the mill that at lower prices would have otherwise been considered waste material and put aside. We are in the unique position that a lot of the development at La Preciosa is in ore and allows us to offset these costs associated with the development work that we would have to do regardless.

I also want to remind the investment community that La Preciosa is not yet in commercial production, and we are providing these costs inclusive of mine preparation costs for future production mining activities, not just the current development mining activities, and anticipate this to be reflected in future quarters. As we noted in our news release, we are revising our production outlook for the full year to 2.2-2.5 million ounces of silver equivalent. As a result, cash costs and all-in sustaining costs per ounce are being revised to a midpoint of $23 and $31 per ounce respectively. All-in sustaining cost per ton is being revised to a midpoint of $90 per ton.

The revision to all-in sustaining cost per ton guidance is a result of more La Preciosa development tons being processed in the year than initially forecasted at the beginning of 2026. Our consolidated cash cost per ton figure for the quarter was $71.40, which is well within our consolidated cost guidance, and our cash cost guidance is unchanged for the full year. At Avino, we are below our midpoint at $59.60 in cash cost per ton, and within the range at just under $80 per ton on an all-in sustaining cost basis. Flipping back to the revenue side, on slide 12 is our expectation for production and revenue by metal moving forward.

We expect the silver portion to continue to increase as our grade expectations at La Preciosa improve into 2027. At this point, I will now turn it back over to David to run through upcoming activities and milestones.

David Wolfin: Thanks, Nathan. Moving to slide 13, our priorities for the remainder of the year remain focused on advancing our operational and growth objectives. At both La Preciosa and the Avino Mine, we intend to complete our planned 2026 drilling programs. At La Preciosa, we will continue underground development activities with a focus on transitioning towards production mining at La Gloria and Abundancia veins and achieving our target mining rate of 500 tons per day. Turning to slide 14, alongside our operational and growth initiatives, we remain committed to responsible mining practices and supporting the communities where we operate. Over many decades, Avino has established strong relationships with our local communities and workforce.

These relationships are reflected in our employee retention, the experience and skill of our workforce, and our continued investment in local employment and development. Today, operations are supported by more than 700 employees and contractors, including approximately 580 at the Avino mine and an additional 127 supporting development activities at La Preciosa. Avino contributes to the local economy through employment opportunities, workforce training, local procurement, and community initiatives. Moving to slide 15, I would like to bring our discussion back to Avino's longer-term growth strategy and opportunities ahead. One of Avino's key advantages is the proximity of our assets and the infrastructure already in place to support future growth.

Within an approximately 20 km area, we have three key assets, including our operating mill complex, which currently processes material from both Avino and La Preciosa. Our established infrastructure, including access to water, power, and tailings management facilities, provides an important foundation as we evaluate opportunities to expand production. Our longer-term objective of reaching more than 10 million silver equivalent ounces of annual production is supported by two principal growth opportunities. Advancing and scaling up La Preciosa, including evaluating potential for standalone processing facility and assessing expansion opportunities at the existing Avino processing plant. We believe the combination of our mineral resource base, existing infrastructure, and strong financial position provides a solid foundation pursuing these opportunities.

Looking ahead, our priorities remain clear. Continue advancing La Preciosa, optimize performance at the Avino mine, and maintain financial discipline necessary to support our growth objectives and create long-term shareholder value. On behalf of our leadership, thank you to our entire team for your efforts and contributions. We would now like to move the call to the question-and-answer portion. Operator?

Operator: Thank you. 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 the handset before pressing any star keys. To withdraw your question, please press star, then two. We will pause for a moment while we allow joiners or callers to join the queue. Thank you. Our first question is coming from Heiko Ihle with H.C. Wainwright. Your line is live.

Heiko Ihle: Hey, David and team. Sorry, I was muted. I assume you can hear me now, right?

David Wolfin: Yep.

Nathan Harte: Right.

Heiko Ihle: Perfect. Okay. You talk about managing production costs, both in the prepared remarks and also in the release here today. Can you maybe give a bit of color on what areas you've seen the most success related to that? I mean, as you know, we were at site a few weeks ago. I mean, I saw the efficiency of the operations firsthand. Obviously, in our view, La Preciosa is engineered much more professionally. I mean, it was just built with a bigger budget than the Avino Mine ever was. I mean, can you just give a bit of color of what you're seeing in regards to cost? Maybe even peg it asset against asset.

Nathan Harte: Yeah, fair question, Heiko. Nathan here. As you mentioned, obviously, there are some cost pressures in the industry. How we're managing it on an asset-by-asset basis, I think with La Preciosa, because I'll start there, because obviously that's kind of the main focus. We're doing a lot of development activities for future mining that we are hit our cost per ton number there that in other iterations maybe wouldn't be hitting your cost per ton. But because we're still in development there, we do expect some of those costs to continue to increase.

Having said that, we are transitioning to production mining, so we'll see an improvement in grade, and that's an automatic improvement in some of the unit costs, especially on a cost per ounce side. With Avino, I think our team's done an excellent job with keeping costs in check. That's been our main driver at Avino, is that we know it's not a high-grade mine, so being able to keep our costs in check on a per-ton basis have been one of our big strengths in the last number of quarters.

Heiko Ihle: Okay. Fair enough. As per your release, La Preciosa drilling has shifted from infill to step-out drilling at various high-priority targets. Can you give a bit of detail on which areas you're focused on, what exactly you're seeing these areas? Then maybe even, if I may, what the analyst community should focus on to model out the future of La Preciosa over the longer term?

Peter Latta: Yeah, thanks so much, Heiko. This is Peter here. With regards to the drilling and the exploration, we kind of put out that release a couple of weeks ago, and I'd be happy to walk you through kind of the 3D model to show you where we're drilling and what we're thinking around it. But really, the big takeaway is that the stopes at La Preciosa are both wider and higher grade than what we typically thought, as well as what's in our current mineral reserve and mineral resource estimates. I think we're going to continue to surprise to the upside on the grade side.

And of course, we're going to integrate that into a new resource and reserve model next year. We're already working on that. But as I mentioned before, or as mentioned in the release, none of those holes, none of the drilling to date has been integrated into that. Really what that means is you'll see that when those reserves come out next year.

Heiko Ihle: Cool. That's helpful. Thank you, guys. I'll get back in queue.

David Wolfin: Thank you.

Operator: Thank you. Our next question is coming from Jake Sekelsky with Alliance Global Partners. Your line is live.

Jake Sekelsky: Hey, David, Nathan, and team. Thanks for taking my questions.

Nathan Harte: Hey, Jake.

Jake Sekelsky: You talked about earlier the processing of the lower-grade development material at La Preciosa. Is that still the strategy here heading into year-end now that metals prices have come off highs? I am just curious if there is a price level where you would rethink this, or are you kind of close enough to fresh ore at this point that it is not much of a consideration?

Nathan Harte: Yeah, that's a fair question. As we mentioned, we are transitioning to fresh ore and production-style mining. At the current prices, we'll still continue processing at the same level we always have been, because this development work has to be done anyways. There's really two options: put it aside for higher metal prices or process it now and relieve some of the pressure on Avino, and I think we prefer the latter. Having said that, as you mentioned, we are shifting towards long-hole production mining and other production-style mining at La Preciosa, kind of as we speak. We can expect that from us in the coming quarter.

David Wolfin: I'd like to add that Peter and I were there two days ago, and we saw the first stope, and the wall rock, the host rock is very competent. It looked beautiful.

Nathan Harte: Yeah.

David Wolfin: So little dilution.

Nathan Harte: Exactly.

Jake Sekelsky: Okay, that's helpful. Then just looking at recoveries, can you maybe just provide a bit of color on what drove the impacts here during the quarter and kind of how we should be thinking about recoveries heading into 2027 as you access some of that fresh ore that David just mentioned?

Peter Latta: Yeah, absolutely. No, definitely as the grade goes up, we expect the recoveries to improve at La Preciosa. We are also implementing a few mechanical improvements. We are buying some equipment that hopefully will be commissioned very soon, or hopefully in Q1 of next year, that will also help improve recoveries. Our metallurgical team is always working on how can we play around with reagents to squeeze a bit more out. So it is something that is always on our mind and something that we are constantly working on.

Jake Sekelsky: Fair enough. Okay, that is all for me. Thanks again.

Operator: Thank you. Our next question is coming from Joseph Reagor with Roth Capital. Your line is live.

Joseph Reagor: Hey, David and team. Thanks for taking the questions.

David Wolfin: Joe.

Joseph Reagor: Couple items on La Preciosa for me. First, you mentioned working on financial study. Can you give us an update on when we might see the release of that? And remind us, is that going to be PEA, or given that where the resource is and development is, it could be PFS level? After that, how long or what additional work would you need to do before you can go forward with whatever plan you chose?

Peter Latta: Yeah, thanks so much for the question, Joe. This is Peter here. It's still a bit early to give you any specific dates on what that's going to look like, but we are looking at a PFS. I think given the level of detail that's been studied at La Preciosa, I think that's what makes sense. We're still fine-tuning a lot of the details. There is a lot of data that we can use from previous work, but there's also data that we have to collect, and we're in the process of doing that. So, we'll have to give an update when we're further down the track with that.

Joseph Reagor: Okay. Post-PFS, would you guys look to immediately go forward with your plan, or is there any permitting that would need to be done for either of the options, either expansion of Avino or a standalone mill?

Peter Latta: I mean, certainly at Avino, we have all the permits in place, and there's no limit as far as the extraction rate from either mine. But if we decided to change strategies at La Preciosa, then there will be some amendments that will need to be made, and of course, engaging the community on that. Like I said, we're not yet at the stage where we have enough information. We're still collecting that, doing some trade-off studies, and looking at a lot of the data. But definitely, that's all top of mind, and happy to provide an update on that in a few weeks.

Joseph Reagor: Okay. Thanks. I'll send it over.

Operator: Thank you. As a quick reminder, ladies and gentlemen, for any questions, please press star one on your telephone keypad. Our next question is coming from Alex Terentiew with National Bank of Canada. Your line is live.

Alex Terentiew: Hey, guys. Thanks for taking my questions. A lot of good questions already asked, so I'm kind of down to my last couple. Just going back to La Preciosa, grades you noted should be increasing soon. Can you just maybe just a little bit more color? I'm just trying to think of Q4, your revised guidance, and then looking into 2027, the quantity of higher-grade material that we could expect. I know on one of your slides there, you're still saying, I know it's just an early guesstimate here, but 3 million ounces of silver equivalent for next year. I'm just wondering, is that the picture still, and how does La Preciosa and grades factor into that number?

Nathan Harte: Hey, Alex. Nathan here. Yeah, that's a fair question. Obviously, we're going through the process right now of evaluating what 2027 is, kind of more of a clear picture of what that's going to look like on a total ounce basis. That's on La Preciosa, yeah, we're expecting more contribution clearly, and that is coming from grade, not necessarily tons, but just the conversion from development to production mining methods. That's really the change you're going to see. On a specific grade number for Q4, I don't want to give a specific number there, but you expect to see improvements.

Alex Terentiew: Okay. I mean, I guess for next year, though, you should be back, or you should be at the, I think it's around 200 grams a ton silver and, I don't know, 0.35 or so gold. Is that kind of the ballpark?

Nathan Harte: Yeah, that's the expectation, Alex.

Alex Terentiew: Expectation, okay. Just a question, Peter. I think you said that there's no extraction rate limit at either mine. I know you're only planning 500 tons a day at La Preciosa, but depending on how prices move and depending on kind of what your studies suggest over the next little while, is there scope under existing permits and abilities to, say, take La Preciosa up from 500 to whatever, 750 or 1,000, if the math makes sense, and then dial back Avino?

Peter Latta: Yeah. There is scope for that, and just keeping in mind that the way our circuits are configured, that we would have to go to 1,000 tons, because that's the kind of the next step up with two of our bigger circuits at 1,000 tons per day and the two smaller circuits at 250 tons each. So you kind of get that stepwise function. That's something that we evaluate as far as the short and the long-term mine plan, is how we dovetail and maximize that, along with the logistics of how we end up hauling it, and how that fits into the plan. So it's something that's always on top of mind in terms of optimization.

Alex Terentiew: Yeah. Okay, that's good. Thanks. That's it for me. Thank you.

Peter Latta: Thanks, Alex.

Operator: Thank you. As a reminder, ladies and gentlemen, if there will be any final questions or comments, please indicate so now by pressing star one on your telephone keypad. Okay, as we have no further questions in queue at this time, I would like to hand the call back to Mr. Wolfin for any closing remarks.

David Wolfin: Thank you again to everyone for joining us today and for your continued interest and support of Avino Silver & Gold Mines. We are encouraged by the results to date. We remain focused on executing our clear path for transformational growth with continued operational improvements, advancement at La Preciosa, a strong balance sheet, and a disciplined approach to capital allocation. We believe Avino is well-positioned to continue creating long-term value for our shareholders. We look forward to updating you on our progress in the coming quarters. Have a great day.

Operator: Thank you. Ladies and gentlemen, this does conclude today's call, and you may disconnect your lines at this time. We thank you for your participation.

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