Superior Gold Inc.

Thanks, Samantha and good morning, everyone. Thanks for joining us today to discuss Superior Gold’s first quarter 2021 results.

I hope that you and your families are all safe and well. As a reminder, please refer to Slide 2 of our presentation, which is posted on our website to review our cautionary language regarding forward-looking statements.

And note that all amounts discussed today are in U.S. dollars unless otherwise indicated.

Joining me this morning are Paul Olmsted, our CFO; and Keith Boyle, our COO. So just as a reminder, we placed the key investment highlights for Superior Gold.

We have our operations located in Western Australia, which is one of the top mining jurisdictions in the world. We own a world-class operating gold mine with significant established infrastructure.

We’ve got a clear and concise optimization and expansion plan, which I’ll discuss in more detail on the next slide. We have significant mineral resource space plus additional exploration upside given a very large and underexplored mineralized system.

And finally, probably the most compelling attribute, the re-rate opportunity that we represent compared to our peers. Taking a look at our growth strategy.

First, we’re working to reestablish steady state production from the underground mine and we’re encouraged to see a return to a state of free cash flow during this quarter. To supplement this underground feed, we’re adding open pit production from a number of new mill producing open pits, including Plutonic East, which is scheduled to commence mining shortly, then Perch, Salmon, Hermes South and Hermes.

The timeframe and CapEx to put these smaller pits into production is relatively short and relatively low. And with the announcement of the Plutonic mine push-back project at the end of 2020, we now have a potentially much longer steady supply of open pit feed here at Plutonic.

The third pillar of growth is recommissioning our second mill, which is currently on care and maintenance. Sources of feed for this mill could come from expiration on our existing property or from several other sources along the Plutonic Marymia Gold Belt.

This provides the opportunity to increase production at Plutonic to well above the current levels with minimal CapEx because of the significant infrastructure that’s already in place. And finally, there’s a potential for new discovery as we invest in expiration at Plutonic.

We certainly had some encouraging exploration drill results so far this year, and we look forward to releasing new results going forward. Turning to safety.

About everything else, that health and safety of our people is the top priority. We continue to successfully operate through COVID and to adhere to the strict measures that we put in place a year ago to mitigate this threat.

Today, I’m happy to report we have no incidences of COVID at our operation or corporate offices for fifth consecutive quarter. We’re also putting a lot of effort into introducing a safety culture here at Plutonic that’s committed to a workplace free of accidents.

So as part of this, we continue to conduct regular safety workshops, as well as put emphasis on slam, hazard identification cards and our felt leadership program. All of this is having a positive impact.

And obviously, we’re trying to ensure that our people know they are the most important priority for us. Taking a quick look at first quarter.

Highlights include that we increased production by 11% quarter-over-quarter to 17,603 ounces of gold with sales of 17,538 ounces all at a realized gold prices $1,777, which is a record. Total cash costs were $1,386 an ounce and all in sustaining costs came down noticeably to $1,510 per ounce sold.

The all in sustaining cost drop is about 10% relative to the previous quarter. However, I do note that the U.S.

dollar denominated all-in sustaining costs continue to be impacted by strengthening of the Australian U.S. dollar exchange, which currently sitting around five-year highs.

We significantly improved our cash flow from operations this quarter to $4.9 million that’s before changes in working capital and the gold loan repayment, and we generated free cash flow, which resulted in improved cash position at the quarter end of $17.9 million. We also improved our stope grade by a further 13% to 3.5 grams per tonne, representing an improvement over the third quarter.

And it’s big jump over the second quarter of 2020. An improved understanding of geology and mineralization at Plutonic has led to establishing two new mining fronts and we’ve demonstrated some exciting drill results coming out of the Baltic Gap and the Western Mining Front.

And I’m going to turn it over to Keith, who’ll discuss our operating results for the quarter.

Thanks, Tamara. As we mentioned, Plutonic produced 17,603 ounces of gold in the first quarter as compared to 16,351 ounces of gold in the same period of 2020.

The increase is large as result of an increase in the contribution of higher grade stope material that reduced the proportion of the lower grade legacy stockpile being milled. Total material milled during the first quarter decreased by 3% to 356,000 tonnes compared to the same period in 2020, partially as a result of processing fewer tones from low grade legacy stockpiles in the first quarter, as legacy stockpile processed included oxide ore, which required the mill to operate at a slightly reduced throughput rate.

Recoveries were 86% for the first quarter representing a continued improvement following the finalization of our gravity circuit – recommissioning of our gravity circuit during the quarter. The highlight of the quarter was the underground stoke grade mined at 3.5 grams per tonne, which represents a 13% increase over the fourth quarter of 2020.

Operationally, we continue to focus on improving productivities, which has benefited from the recent arrival of the new mobile mining equipment aimed at improving both equipment availability and lowering our maintenance costs. In addition, in an enhanced understanding of the geology and mineralization at Plutonic has improved our ability to predict the areas of higher grade mineralization at the underground operation.

We’ve seen a steady improvement in the results following the operational improvements we’ve implemented at Plutonic as illustrated on Slide 9. The underground mine stope grade of 3.5 grams in the first quarter represents an increase of almost 50% over the second quarter of 2020.

We’ll continue to target the mine stope grades above 3 grams on average. As a result, the average head grade is increased by 25% since the second quarter of 2020 and overall quarterly production is increased by 16% highlighting the importance of mine stope grade to our overall profitability at Plutonic.

I’ll now turn the call over to Paul Olmsted, Chief Financial Officer to discuss our financial results for the quarter.

Thanks, Keith. During the first quarter our revenue totaled $31.2 million from sales of 17,538 ounces of gold, an increase of $4.7 million from $26.5 million from the sale of 16,850 ounces of gold in the first quarter of 2020.

Gold revenues were higher as a result of 688 more ounce is being sold as well as an increase in the realized gold price to $1,777 per ounce from $1,570 per ounce. Costs of sales were $26.9 million for the first quarter of 2021, an increase of $3.2 million from $23.7 million for the first quarter of 2020.

This was due to the stronger Australian dollar the impact of which resulted in a $4 million increase. Despite an Australian dollar decrease in all cost of sale categories with the exception of depreciation and amortization.

Also to facilitate more effective cite reporting there was a reallocation of certain camp costs from mining and processing to site services in the first quarter of 2021 versus the first quarter of 2020. Adjusted net income for the first quarter of 2021 amounted to $1.8 million or $0.01 per share compared to adjusted net loss of $100,000 or zero cents per share in the first quarter of 2020, primarily due to the higher operating earnings in the current period.

During the first quarter cash from operating activities before working capital changes was $2.7 million, a $1.5 million increase over cash from operating activities of $1.2 million for the first quarter of 2020. The increased in cash generated from operating activities was predominantly a result of stronger operating earnings in the first quarter of 2021 in comparison to the first quarter of 2020.

The chart on the right highlights that in the first quarter cash flow from operations before working capital changes and before the repayment of the gold loan increased significantly by $4.7 million compared to the same period in 2020. And at the end of the quarter, the company had $17.9 million in cash and cash equivalents.

We expect to fully repay our gold loan by the end of June. And as a result expect increased cash flow from operations moving forward.

I’ll now turn the call back to Tamara to continue with the rest of the presentation.

Thanks, Paul and thanks, Keith. So on the next slide our production guidance for 2021 remains unchanged and so happy to reiterate that we continue to expect production of between 65,000 and 75,000 ounces of gold for the full year.

Looking at the underground optimization, as you’re all aware, we’re currently focused on unlocking the value in the underground with production growth, margin optimization and systematic exploration. But first, we’re focused on optimizing that grade that we mine from the stopes in the underground.

It’s an important factor in determining our profitability here. As such, we are fully engaged and driving towards an average stope grade of better than 3 grams, as Keith said.

We are pleased to report we have further advanced geological understanding of Plutonic orebody, including those northwest trending faults that control the location and concentration of higher-grade gold mineralization here. This has led to a number of strategically significant exploration results, as well as the identification of higher-grade stopes on the operational front.

We also continue with improving our frontline planning and scheduling and our reconciliation program, which is providing invaluable information to inform our block models. In mining operations, we’ve revitalized our underground mining fleet with the addition of two new trucks and two new loaders, which are all now on site.

This has already improved our equipment availability and reduce our maintenance costs, as we focus on minimizing equipment movement around the mine with more strategic mine planning. And at the mill, which operates very well, as Keith noted, and we’ve recently recommissioned that gravity circuit, which is having a positive impact on our recovery.

We’re also completing a number of economic studies, whereby we’re looking at opportunities to further increase our production rate to well beyond the current levels. With low cost expansion opportunities, as we will be utilizing the existing infrastructure on site.

And finally, the addition of that third drill rig has been very exciting as it’s completely dedicated to exploration, and it’s allowing us to have a steady flow of exploration results. Turning to the next slide and looking at the open pit, as I mentioned, we’re working on adding several smaller open pits to control production up to the 100,000 ounce level.

This is all from past-producing pits, including Plutonic East, Perch, Salmon on the Plutonic property and then the Hermes South and Hermes projects located to the Southwest. As planned, we expect to begin mining at the Plutonic East open pit in mid-2021, so very soon.

And all of that grade control drilling and other work has been completed there. The plan to utilize the production from these open pits, plus the main pit with – along with the operational improvements from the underground to increase production at Plutonic and it improves to a steady the site of significant free cash flow generation.

Taking a look at exploration, we recently announced promising results during the first quarter. Our drill rig started in the program in December 2020.

These slides are remainder that there are significant intercepts in close proximity to existing infrastructure, as well as ore grade intercepts located only a kilometer outside of the mineralized mafic and should be clear that the limits of mineralization have yet to be found. And with continued investment exploration at Plutonic is very promising.

So taking a look at the cross section, in the near term, our focus in the underground is on exploring and developing into new mining fronts, so that we have a lesser reliance on remnant mining. We believe that the two mining farms being the Western mining front shown here in the Baltic Gap will be key to improving the profitability to operation in the near term.

We recently announced the results from both these areas. Taking a look on March 1, we announced the results in drill programs completed in the Baltic West region.

We extremely pleased to report each drill hole completed to date intercepted significant gold mineralization, proving that our geologists are improving their understanding of the geology and the mineralization extension here at Plutonic. Significant intercepts included 13.7 grams over 8.8 meters and 52.7 grams over 1 meter.

You can see from this image that these intercepts are outside of our existing resources. But still within 50 meters of existing infrastructure, which allows us to infill and bring these results into our reserves and resources and mine plan in a short period of time.

So March 29, we provided a second exploration update in the first quarter, which was results from the Baltic Gap. These drill results demonstrate mineralization extends North of the Baltic zone, opening a new mining front into the Baltic Gap.

This area’s never been fully drill tested, remains open down different along strike. Similar to the results released last year, these latest intercepts, which are highlighted by 21.8 grams over 8.3 meters are outside of existing mineral resources, but within only 50 meters of our existing underground industry infrastructure, extension of our existing mineral resources are key components of that current strategy to expand into mining fronts and improved mining grades and productivity here at Plutonic.

As on the next slide, as we mentioned earlier today, we are improving our understanding as the Plutonic geology. Technological advances of the lab old historic datasets to be incorporated into 3D modeling software, to assist in better understanding that Plutonic orebody.

So as geologists, we are now creating dynamic 3D geological model that incorporate all historical geological data, including available drill holes or historic face maps, which includes ecological, structural alteration and mineralization information. Starting with pit mapping and regional geological mapping datasets in order to more accurately and more quickly model the Plutonic orebody in 3 dimension, so we found that these straightened models are better at predicting the location in three dimensions of the mineralization at Plutonic and it has obvious implications on the operational front, as we have better able to mine plan and better able to assist our exploration targets.

Moving forward, we would expect that these 3D models will be incorporated into our mineral resource block model process. We estimate that that may take up to 12 months in the process, but certainly will be very beneficial to us moving forward.

The Slide 19, upcoming catalysts, we certainly have a number of noteworthy catalysts moving forward. We continue to expect more regular underground exploration results that third drill rig operating and dedicated to exploration.

During the second half of the year, we also expect to have a surface drill rig on the property, and we’ll be excited to be announcing results, both for infield drilling for the main pit project and right across the Plutonic property for surface targets that we’re looking at. We also look to be repaying that gold loan in June this year, which we expect will be a turning point for the company, as investors recognized the free cash flow being generated by this operation.

We also expect to be commencing and announcing heritage surveys, which will hopefully have some positive impacts on our main pit project and make it clear at the timing for us of the Hermes South project. And finally, we do expect to begin production very soon from Plutonic East.

For the next 12 months, we have a healthy pipeline of development and exploration catalyst, as we look forward to releasing. Slide 20 is just a quick summary of the analysts, which currently covered the stock, actually held in the capital structure.

We were encouraged by the continued support of the investment community. But we are certainly targeting an improvement in our valuation, multiple moving forward, which on the last slide is what I want to leave you with is that re-rate opportunity that exists with the Superior Gold.

So by continuing to deliver on our commitments, we believe the company will be revalued with significant upside that exists between our current, multiple, and that about here average. In addition at current market cap is actually below the main peak PEA NPV, that we announced in late 2020.

So we’re focused on repositioning Plutonic for long-term success, improving that valuation, unlocking value for shareholders. And we encourage you to take another look at this opportunity.

Thank you very much, operator. Now I’ll now like turn the line for questions.

Thanks, operator. I guess that’s a sign that we’ve delivered in medics protections for shareholders today.

Since there are no further questions, thanks everyone for joining us. We’re extremely pleased with our strong first quarter results and obviously it’s important to see the company returning to a period of free cash flow generation.

They’re going to continue to advance these strategic projects necessary to reposition Plutonic for long-term sustainable success, which includes optimizing that underground operation, incorporating new sources of open pit feed and increasing our production levels, while we further advance the understanding of the extensions and mineralization of Plutonic. We expect these improvements combined with upcoming full repayment of that gold loan in June.

We will drive continued improvement in our financial performance over the course of 2021 and beyond. So thanks, again, for joining us today and stay safe.