- OPERATIONAL AND FINANCIAL HIGHLIGHTS
Q2-2021 production up 18% over Q1-2021 to 409koz, while AISC decreased by $15/oz to $853/oz
Strong H1-2021 performance of 756koz at an AISC of $860/oz positions the Group well to meet the top half of its FY-2021 production guidance of 1,365-1,495koz at an AISC of $850-900/oz
Adjusted Net Earnings (from cont. operations) of $183m or $0.73/share in Q2-2021; $276m or $1.20/share in H1-2021
Operating Cash Flow before working capital (from cont. operations) of $286m or $1.13/share in Q2-2021; $549m or $2.39/share in H1-2021
Healthy balance sheet at quarter-end with Net Debt to adjusted EBITDA leverage ratio of 0.07x; Net Debt decreased by $85m during the quarter to $77m and gross debt decreased by $120m
SHAREHOLDER RETURNS PROGRAMME


First dividend of $60m paid on 5 February 2021 for the 2020 fiscal year
Declaration of H1-2021 interim dividend of $70m, with record date set at 10 September 2021; well positioned to deliver more than the minimum committed dividend of $125m for the full year
Share buybacks continue to supplement shareholder returns with a total of $70m of shares repurchased since April 2021, $59m of which were repurchased in Q2-2021
ORGANIC GROWTH

Construction of Sabodala-Massawa Phase 1 expansion on schedule for completion by year-end; DFS underway for Sabodala-Massawa Phase 2 expansion, Fetekro, and Kalana projects
Group on track to discover over 2.5Moz of Indicated resources in 2021; significant discoveries recently made at Ity, Houndé, Sabodala-Massawa and Fetekro
London, 4 August 2021 – Endeavour Mining plc (LSE:EDV, TSX:EDV, OTCQX:EDVMF) ('Endeavour' or the 'Group' or the 'Company') is pleased to announce its financial and operating results for Q2-2021 and H1-2021, with highlights provided in Table 1 below. Management will host a conference call and webcast on Wednesday 4 August, at 8:30 am ET / 1:30 pm BST. For instructions on how to participate, please refer to the conference call and webcast section at the end of the news release.

Table 1: Consolidated Highlights1

All amounts in US$ million, unless otherwise stated THREE MONTHS ENDED SIX MONTHS ENDED
30 June 2021 31 March 2021 30 June 2020 30 June 2021 30 June 2020 ? H1-2021 vs. H1-2020

OPERATING DATA
Gold Production, koz 409 347 149 756 321 +136%
All-in Sustaining Cost2, $/oz 853 868 941 860 916 (6)%
Realised Gold Price, $/oz 1,791 1,749 1,680 1,771 1,603 +10%

CASH FLOW FROM CONTINUING OPERATIONS3
Operating Cash Flow Before Changes in Working Capital 286 263 75 549 170 +223%
Operating Cash Flow Before Changes in Working Capital2, $/share 1.13 1.27 0.67 2.39 1.54 +55%
Operating Cash Flow 300 207 53 507 153 +231%
Operating Cash Flow2, $/share 1.19 0.99 0.48 2.21 1.38 +60%
PROFITABILITY FROM CONTINUING OPERATIONS3
EBITDA2 363 333 23 696 124 +461%
Adjusted EBITDA2 400 306 99 706 206 +243%
Net Earnings/(loss) Attributable to Shareholders2 127 87 (38) 213 (22) (1068)%
Net Earnings per Share, $/share 0.50 0.42 (0.35) 0.93 (0.20) (565)%
Adjusted Net Earnings Attributable to Shareholders2 183 93 49 276 74 +273%
Adjusted Net Earnings per Share2, $/share 0.73 0.45 0.44 1.20 0.66 +82%
SHAREHOLDER RETURNS
Dividends paid — 60 — 60 — n.a.
Share buyback (commenced in Q2-2021) 59 — — 59 — n.a.
FINANCIAL POSITION HIGHLIGHTS
Net Debt/(Net Cash)2 77 162 473 77 473 (84)%
Net (Cash)/Debt / Adjusted EBITDA (LTM) ratio2,4 0.07 0.16 1.00 0.07 1.00 (93)%
1All amounts include Teranga assets from 10 February, 2021 2This is a non-GAAP measure. Refer to the non-GAAP measure section of the Management Report. 3From Continuing Operations excludes the Agbaou mine which was divested on 1 March, 2021. 4LTM means last twelve months.
Sebastien de Montessus, President and CEO, commented: “Our strong Q2 performance positions us well to achieve the top half of our production guidance for the full year, as all our mines are continuing to perform well and we have quickly integrated the Teranga assets within our business.

Our strong free cash flow generation has significantly improved our balance sheet strength and bolstered our ability to reward shareholders. We paid our first dividend of $60 million in Q1 for the 2020 fiscal year, and today we are declaring an interim dividend of $70 million for H1-2021, placing us on track to deliver more than the guided minimum dividend of $125 million for the full year. Given our near zero Net Debt to adjusted EBITDA leverage ratio, we have been supplementing our shareholder return programme with share buybacks, having repurchased $70 million of shares since April.

Our growth pipeline continues to develop with the Sabodala-Massawa phase 1 expansion on track to be completed in Q4-2021 while Definitive Feasibility Studies are progressing well for the Sabodala-Massawa Phase 2 expansion, Fetekro, and Kalana projects.

We have enjoyed further exploration success, with significant discoveries made at Ity, Houndé, Sabodala-Massawa and Fetekro, where updated resources are expected to be published later this year. Overall, the group is on track to delineate over 2.5 million ounces of Indicated resources in 2021, which represents significantly more than the expected annual depletion and contributes to our portfolio’s longevity.

We are also very pleased to have successfully completed our listing on the premium-segment of the London Stock Exchange in June and remain on track to be included into the UK and European indexes.

These achievements leave Endeavour well positioned for the remainder of the year and beyond.”

UPCOMING CATALYSTS

The key upcoming expected catalysts are summarized in the table below.

Table 2: Key Upcoming Catalysts

TIMING CATALYST
Q3-2021 Exploration 5-year exploration strategy
Q4-2021 Sabodala-Massawa Completion of Phase 1 plant upgrades
Q4-2021 Sabodala-Massawa Completion of Definitive Feasibility Study for Phase 2
Q4-2021 Fetekro Completion of Definitive Feasibility Study
Q1-2022 Kalana Completion of Definitive Feasibility Study
LONDON STOCK EXCHANGE LISTING

Endeavour’s premium listing on the London Stock Exchange (“LSE”) was successfully completed on 14 June 2021, positioning Endeavour as the largest pure-play gold producer listed on the premium segment of the LSE.
Endeavour is well positioned to be included in the upcoming FTSE Russell index quarterly review based on its recent re-domicile to the UK and subject to its trading liquidity being above the required threshold. Membership changes to the indices are expected to be communicated by FTSE Russell on 1 September 2021 with potential inclusion becoming effective on the 20 September 2021.
In addition, Endeavour expects to be eligible for inclusion in the MSCI Europe index, with index rebalancing occurring on 30 November 2021 following the semi-annual review which is expected to be completed by mid-November.

SHAREHOLDER RETURNS PROGRAM

As disclosed on 7 June 2021, Endeavour has implemented a shareholder returns programme that is composed of a minimum progressive dividend that may be supplemented with additional dividends and buybacks, providing the prevailing gold price remains above $1,500/oz and that Endeavour’s leverage remains below 0.5x Net Debt / adjusted EBITDA.
The minimum progressive dividend policy has a target of distributing at least $500 million to shareholders over the next three years. Minimum dividends are set at $125 million, $150 million and $175 million for FY-2021, FY-2022, and FY-2023 respectively, payable semi-annually, significantly higher than our inaugural FY-2020 dividend of $60 million.
Endeavour is pleased to declare its H1-2021 interim dividend of $70 million or $0.28 per share based on its current issued share capital, which represents 56% of the minimum dividend for FY-2021, highlighting its strong commitment to paying supplemental shareholder returns. The ex-dividend date for the interim dividend will be 9 September 2021 and the record date will be 10 September 2021. The dividend will be paid on or about 28 September 2021 (the “Payment Date”).
Shareholders of shares traded on the Toronto Stock Exchange will receive dividends in Canadian Dollars (“CAD”), but can elect to receive United States Dollars (“USD”). Shareholders of shares traded on the London Stock Exchange will receive dividends in USD, but can elect to receive Pounds Sterling (“GBP”). Certificated shareholders will receive dividends in USD but can elect to receive dividends in GBP or CAD. Currency elections must be made by shareholders prior to 17:00 GMT on 13 September 2021. Dividends will be paid in the default or elected currency on the Payment Date, at the prevailing USD:CAD and USD:GBP exchange rates on 15 September 2021. This dividend does not qualify as an “eligible dividend” for Canadian income tax purposes. The tax consequences of the dividend will be dependent on the particular circumstances of a shareholder.
Shareholder returns are being supplemented through the Company’s share buyback programme. A total of $70 million of shares have been repurchased since the start of the buyback programme on 9 April 2021 until end of July 2021, of which $59 million or 2.7 million shares were repurchased in Q2-2021.

ON TRACK TO ACHIEVE FY-2021 GUIDANCE

Strong H1-2021 performance of 756koz at an AISC of $860/oz positions the Group well to meet the top-half of its FY-2021 production guidance of 1,365-1,495koz at an AISC of $850-900/oz.
H2-2021 will benefit from the full consolidation of the Sabodala-Massawa and Wahgnion mines, which have been consolidated starting from the closing date of the Teranga Gold acquisition of 10 February 2021.
Group sustaining and non-sustaining capital expenditure outlook for FY-2021 remains in line with initial guidance of $173 million and $201 million, respectively.

Table 3: H1-2021 Performance vs. FY-2021 Guidance

H1-2021 2021 FULL YEAR GUIDANCE
Production, koz 756 1,365 — 1,495
AISC, $/oz 860 850 — 900
CASH FLOW AND LIQUIDITY SUMMARY

The table below presents the cash flow and Net Debt position for Endeavour for the three and six month period ending 30 June, 2021, with accompanying notes below.

Table 4: Cash Flow and Net Debt Position

THREE MONTHS ENDED SIX MONTHS ENDED
In US$ million unless otherwise specified 30 June 2021 31 March 2021 30 June 2020 30 June 2021 30 June 2020
Net cash from (used in), as per cash flow statement:
Operating cash flows before changes in working capital from cont. operations 286 263 75 549 170
Changes in working capital 15 (57) (21) (42) (17)
Cash generated from/(used by) discontinued operations 0 (9) 4 (9) 30
Cash generated from operating activities (Note 1) 300 198 57 498 183
Cash used by investing activities (Note 2) (137) (105) (48) (243) (105)
Cash (used in)/generated from financing activities (Note 3) (192) 65 (16) (127) 84
Effect of exchange rate changes on cash (7) (4) 1 (10) 0
INCREASE/(DECREASE) IN CASH (35) 154 (6) 118 162
Cash position at beginning of period 868 715 357 715 190
CASH POSITION AT END OF PERIOD (Note 4) 833 868 352 833 352
Equipment financing 0 0 (64) 0 (64)
Convertible senior bond (330) (330) (330) (330) (330)
Drawn portion of corporate loan facility (Note 5) (580) (700) (430) (580) (430)
NET DEBT/ (CASH) POSITION (Note 6) 77 162 473 77 473
Net Debt / Adjusted EBITDA (LTM) ratio1 (Note 7) 0.07 x 0.16 x 1.00 x 0.07 x 1.00 x
1Net Debt and Adjusted EBITDA are Non-GAAP measures. Refer to the non-GAAP measure section of the Management Report.

NOTES:

1) Operating cash flows increased by $102.5 million from $197.9 million (or $0.99 per share) in Q1-2021 to $300.5 million (or $1.19 per share) in Q2-2021 mainly due to higher gold sales at a higher realised price as well as lower operating costs and a working capital inflow, which more than offset the higher income taxes paid and the foreign exchange losses incurred. Operating cash flow before non-cash working capital from all operations increased by $22.2 million from $263.4 million (or $1.27 per share) in Q1-2021 to $285.7 million (or $1.13 per share) in Q2-2021. Notable variances are summarised below:

Gold sales increased by 57koz over Q1-2021 to 421koz in Q2-2021 due to the benefit of a full quarter of production from the newly acquired Sabodala-Massawa and Wahgnion mines, together with strong performances at Houndé and Ity. The realised gold price for Q2-2021 was $1,791/oz compared to $1,749/oz for Q1-2021. Total cash cost per ounce decreased from $751/oz in Q1-2021 to $729/oz in Q2-2021 due to the inclusion of the lower cost Wahgnion and Sabodala-Massawa mines for the full quarter
Income taxes paid increased by $82.9 million to $106.5 million in Q2-2021 reflective of the timing of provisional payments based on full year 2020 earnings
Working capital was an inflow of $14.8 million in Q2-2021 due to the reduction in receivable balances and inventories. Specifically, VAT receivables at Houndé decreased and certain corporate receivables were received in Q2-2021. There was also a reduction in inventory stockpiles and finished gold inventories at Ity, Sabodala-Massawa and Wahgnion
Acquisition and restructuring costs of $14.5 million in Q2-2021 related to the Teranga acquisition and integration as well as restructuring costs
2) Cash flows used by investing activities increased from Q1-2021 to $137.3 million in Q2-2021 due to increased expenditures on mining interest including sustaining capital and non-sustaining capital:

Sustaining capital from continuing operations increased by $13.9 million from Q1-2021 to $41.5 million in Q2-2021 due to higher sustaining capital at Boungou, Houndé and Ity primarily due to planned waste capitalisation
Non-sustaining capital from continuing operations increased slightly in Q2-2021 to $58.3 million, due to increases at Wahgnion and increases in non-mining capital expenditure which were mostly offset by decreases at Ity, Mana and Houndé
Growth capital spend decreased by $15.4 million from Q1-2021 to $12.6 million in Q2-2021 and primarily relates to the Massawa expansion with the remainder for ongoing Definitive Feasibility Studies (“DFS”) studies
3) Cash flows used by financing activities increased by $256.4 million to $191.8 million in Q2-2021 mainly due to a higher net repayment of long-term debt in Q2-2021, which was $120.0 million and payments for the acquisition of own shares, as part of the ongoing share buyback programme, of $59.5 million, which started in Q2-2021.

4) At quarter-end, Endeavour’s liquidity remained strong with $832.9 million of cash on hand and $220.0 million undrawn of the RCF. The Company will seek to reduce its cash balance in the upcoming quarters by continuing to pay down its debt.

5) Endeavour's corporate loan facility was increased from $430.0 million to $800.0 million in Q1-2021 to retire Teranga’s various higher cost debt facilities. In Q2-2021 $120.0 million was repaid on the facility with $580.0 million drawn on the facility at quarter-end.

6) Net Debt amounted to $77.1 million at quarter-end, a decrease of $84.9 million during the quarter despite dividend payments of $60.0 million and $59.5 million of shares repurchased. In H1-2021, Net Debt increased by $152 million compared to the beginning of the year as approximately $332 million of Net Debt was absorbed from Teranga in Q1-2021.

7) The Net Debt / Adjusted EBITDA (LTM) leverage ratio ended the quarter at a healthy 0.07x, down from 0.16x in Q1-2021, and well below the Company’s long-term target of less than 0.50x, which provides flexibility to continue to supplement its shareholder return programme while maintaining headroom to fund its organic growth. The ratio has improved by 93% from the corresponding period last year when the ratio stood at 1.00x.

EARNINGS FROM CONTINUING OPERATIONS

The table below presents the earnings and adjusted earnings for Endeavour for the three and six month period ending 30 June, 2021, with accompanying notes below.

Table 5: Earnings from Continuing Operations
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