Wesdome Gold Mines Ltd.

Heather Laxton - Chief Governance Officer and Corporate Secretary Duncan Middlemiss - President & CEO Hemdat Sawh - CFO Philip Ng - COO George Mannard - VP-Exploration Lindsay Carpenter Dunlop - VP-IR

George Topping - Industrial Alliance Ryan Walker - Echelon Wealth Partners

Thank you, operator, and good morning everyone. Welcome to Wesdome Gold Mines 2017 first quarter financial results conference call.

Before we begin, I would like to remind everyone that today's call may contain forward-looking statements or information. Forward-looking statements are based on certain material factors and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially from the expectations and assumptions discussed today.

We will refer you to the detailed cautionary note regarding forward-looking statements contained in yesterday's press release and in the company's interim management discussion and analysis dated May 03, 2017. Both documents are available on the company's website and on SEDAR.

Please note that all figures discussed on this call today are in Canadian dollars unless otherwise dated. A replay of this webcast will be available on the company's website.

On the call with us this morning, we have Duncan Middlemiss, President and CEO.

Good morning.

Hemdat Sawh, Chief Financial Officer.

Hello, this is Hamdat Sawh.

Philip Ng, Chief Operating Officer

Hello, Philip here.

George Mannard, Vice President-Exploration.

Good morning, George here.

And Lindsay Carpenter Dunlop, Vice President-Investor Relations

Good morning, everyone.

And now, over to Lindsay for a review of the agenda for today's call.

Thanks Heather. The agenda for today's call will be as follows.

First, a review of the operational results by Duncan Middlemiss followed by our financial results review by Hemdat Sawh. Then exploration update on the Eagle River Complex, Kiena Project, and Moss Lake Property by George Mannard.

Finally, Duncan will conclude with the summery and outlook. We will then open the lines up for question-and-answer.

Duncan please go ahead.

Great, thanks Lindy. Well, first and foremost I would like to commend the operations team for delivering excellent production this quarter firstly.

Total allowance produced in the first quarter for the Eagle River Complex was 15,162 ounces. From the Eagle River early in our mind, 38,578 tons metre levels at a head weight of 11.5 grams per ton for 13,588 ounces recovered.

The Eagle River head weight for the quarter was 25% higher than the reserve rates due to increased mines of 811 and 7 Zone stores, as well as development origin rates from the 300 East Zone. The 300 East Zone including 301 and 303 lenses are very perspective due to the right risk and high grades.

We expect full production from the 303 lens in the fourth quarter of this year. Development work in the other higher grade area to the mine is also taking place.

In addition to the 303, store core development in the 300 East and West Zones are planned this year. We expect cut rates to be at or above reserve gates for the rest of the year as a result of this work.

Historically, the mine economy has two high grade areas in production at anytime. However, this year we will have up to four high grade stope in production.

The recent discovery of the up plunge extension at the 300 west zone means we will have additional production flexibility from this area for 2017 and beyond with development taking place now. Production costs per ounce have been reduced significantly this quarter to $1156 per ounce, the low end of our cost guidance of $1030 to $1130 per ounce.

This is the range we feel the sustainable with room to improve as we expect to mine higher grades in developed mining flexibility to positive exploration results and important infrastructure upgrades in ventilation and power. Higher grades are a results of the exploration development work conducted over the past 12 months.

All in sustaining costs of $1474 per ounce are well within our guidance of 1450 to 1550 per ounce. Again there are opportunities to improve on this in the second half of the year.

I will now turn the call over to Hemdat for the financial review.

Thank you, Duncan. During the quarter we sold 12,320 ounces and generated $20.1 million of revenue at an average realized prices of Canadian 16.31 per ounce.

Sales were lower than gold production of 15,162 ounces due to the timing of gold course. Revenue from the subsequent quarter has been booked in the second quarter at a higher gold price.

This delay in same sales in the first quarter has impacted net income and the earnings with the net income of 700,000 Canadian and $0.01 per share. Revenue, cash flows from operations, and net income are a significant improvement over Q1 2016s results, despite a lower realized gold price.

This is a result of development and exploration efforts that have resulted in better mine sequencing bringing up average mine grades. We generated $4.3 million from operations and spent a combined total of $9.6 million on sustaining CapEx and exploration, which were both in line with Q4, 2016 expenditures.

This net out flow of $5.3 million was offset by $1.6 million from the exercises stock options and $6.9 million of restricted cash which became free as we have arranged a standby letter of credit facility to satisfy our closure plan obligations at Kiena and Eagle River. Accordingly, our cash balance at the end of the quarter was $209.06 million, a 10% or $2.7 million increase over Q4 2016 ending balance of $206.8 million.

We are pleased to report that 2.1 million of the $7 million convertible debentures were converted in Q1 2017. These debentures have a $2.50 straight price and mature on May 24, 2017.

I will now turn the call over to George for a review of exploration.

Thank you, Hemdat. To overview of the operations of the exploration we have been very busy in the first quarter.

We have three underground drills operating at the Eagle River mine, two drills drilling in Mishi West expansion, four underground drills at Kiena, and two drills on the Moss Lake projects, at a total of 11 drills, we drilled 54,000 metres of drilling as an all-in drilling cost of $4.8 million in the first quarter. As the Eagle River mines drilling has been very successful to finding and developing the parallel 307 Zone structures in recent years.

As of December 31, 2016 these new structures currently comprise 55% of our reserve ounces and continue to demonstrate potential to growth. On January 26, we announced results of drilling in the 300 east areas that included 19.03 grams for ton cuts over 20.67 metres true width and 13.36 grams per ton over 17.94 metres true width.

During the Q1, we announced development of the structure on the 844 million levels and expect to release drifting results in the medium term. Development to-date has defined at least four subzones with above average width and grade as we defined our dimensions and geometry is become very apparently remains above and below and have the potential to correlate.

On April 27, we released drill results from the 300 West area which effectively trades for zone 250 metres up plunge and are highlighted by an intersection of 12.57 grams per ton cost over respectable true width 5.75 metres. This zone remains open towards shallow mining levels.

At Mishi mines, we have two drills currently delineating and defining Mishi west expansion. Today drilling demonstrates reasonable continuity for 700 metres west of the pit as 25 metres facing with early indications of potential continuity over 2 kilometers price length as suggested by more widely spaced drilling results released on April 27 and its illustrated in the drill plan.

Our goal is to rapidly access this potential generate updated resource statements and evaluate the long-term growth prospects of these mining operations. We are rapidly and efficiently add ounces.

At the Kiena mine drilling in the first quarter is becoming challenging due to deeply inclined nature of the core deposits in order to resolve the success rate in advance our drill coverage we decided to drive an exploration ramp down to 1100 metres level. This decision confronts our commitments to this exciting discovery, advances our growth flexibility and potentially accelerates assets to its upper regions.

The estimated timeline to compete the ramp is 9 to 10 months. In the mean time through exploration growth we will continue targeting the Upper Quartz Vein Zone and North Vein target.

This [indiscernible] projects and we are targeting ahead on this. The Moss Lake projects, the Moss Lake and coal stream deposits, gold despots are large bulk tonnage target.

They are located 100 kilometers due west Thunder Bay and the programs for 2017 is an ambitious effort design to double the expense of drilled coverage along with open trends of the Moss Lake and each coal stream gold deposits. Strategic acquisitions in 2016 of enabling properties enable sufficient realized.

The most recent PEA conducted in 2013 constraints its limit to previously existing property boundaries. To-date, geophysical surveys IT suggest continuity and widely based 200 metres [indiscernible] drill expense are underway.

On drilling, answer to the question how big can these deposits be. I will now turn the call back over to Duncan and will deal to any questions in due course.

Great, thanks George. I would like to take a few minutes to comment on our recent share price performance in 2017.

On March 10, GDXJ or the VanEck Junior Miners Exchange Traded Funds announced that West Zone will be added to the index. With the demand for 18 to 20 million shares, these balance to the fact aftermarket close on March 17, with 25 million shares credit and shared price closing $4.40.

On April 12, the GDXJ announced changes to its methodology taking affect during the next quarterly week out which is in June. The key change is the upper market capital Quartz Zone being increased from US $1.5 billion to US $5 billion.

Therefore larger cap companies will be added and smaller cap companies will be down. At this time we do not expect to be deleted from the index, but we do anticipate the downgrading.

We believe this is the primary reasons where we can share price weakness rather than the fundamentals of the company. 2017 production started stronger than our 2017 budget, which respect to grade ounces and gold prices.

And this is the trend which we believe will continue. Lastly, our 2017 production cost guidance.

In summary, we are currently maintaining our 2017 guidance of 52,000 to 58,000 ounces. We continue to focus in on mine exploration at Eagle River where results are having an immediate and short-term positive impact on higher mine rates.

We are reasonably filling our niches and we will have an update resources on entire Eagle River Complex in the first quarter of 2018. I will now let - turn over to any questions that you may have.

Hi, hello, everyone. Duncan, could you give us these ramp debt that you are planning to go to at the expenditure?

With the Kiena ramp search?

Yes, indeed.

Yes, okay. First thing you got to translate now to develop well over thousands lateral metres for ramp development.

We'll get down around I would say 55 metres from the current ramp stage, which is out of, normally at thousands of - going to be just like the above the actual 1100 metre sub level.

Okay. And the - what's in height will it be able to handle meaningful production?

Yes, well, George we already have an existing ramp there which is currently driven at 4.5 or 4.5 metres, so we will continue with that side.

All right, very good. Maybe one for George here is the drilling - the two drills that will continue to drill while you drive the ramp, will they have enough angle on targets to be able expand these known delineated area or are you going to be able to drill from the ramp as it continues to work its way down.

There are two parts to that. The one is, as we trace the main zone at depth from our existing areas or its deeply inclined the whole service changing its deeply inclined body.

So, it's becoming inefficient and we can't follow it any further at that. If you look at the most recent press release on Kiena you will see a whole 61.6 which intersected 6.63 grams per ton over 11 metres, that was above 1,000 metres.

West Zone remains open to the north and we are going to aggressively follow that out on label number 23 on the figure. So, we have open areas to drill extending to the north and upwards.

Okay. And that’s enough for the two drills, because it's going to be 10 to 12 once until you get to the bottom of the ramp?

Yes, the result has been adjusted. I mean in that timeframe, essentially we are putting out the tender for the ramp development today because I mean really a lot of that timeframe is dependent on how quickly they can mobilize and really want to performance is going to be.

I would have to say the 9 to 10 month is very conservative estimate of development programs, so until we know better we will just keep it that.

I see, okay. And one final question before I will leave it for other analysts, as the Moss Lake camp, you mentioned doubling the potential mineralization.

Are you expecting that at roughly the same grades or is there any indication on that?

Yes, exactly. Well, we have large resource that 1.1 grams at both deposits and what we are doing is we are doubling with low coverage into an area that is never been drilled before and it was previously tied up by awkward property foundries.

This is a large vision to see how big this thing could be and where would sit in our corporate strategy moving forward.

I think we would expect really great to be much as the same - George I think…

We are doing an open extension with loan deposits.

Good stuff. That’s it from me.

Thanks.

Hi guys, thanks for the call. So, I'll question, when do we expect the next batch of [indiscernible].

I think that's going to be - Ryan, it's going to be - I think a couple of months, I don’t think really – I think this ramp decision is really been mitigated by the difficultly of us, getting down to the target. As George mentioned before, the steeply inclined nature of the ore, and steeply incline nature of the drill holes, really don't add up great success rate now.

So we got some things currently getting our phase and I think that we will - we'll just wait on that but I think it's going to be another six weeks probably before we fully understand what we have.

Okay, great. And can you just maybe talk a little bit about the timing on the balance of the CapEx spend for the year.

Is it going to be waited into any particular quarter?

I think really if you look at, I think it's fairly consistent at the Eagle River really what’s going to happen is the Kiena was - Kiena start, and that’s all really contracted the presenters when the start date is, we're going to burn some cash but at the mean time we are also backing up on drilling. So we are going to have a little bit of the down leading in the drilling.

Certainly as far as mentioned the $13.1 million exploration program, we already spent almost five on it now. So, we are front waited on that, so that's going to start to dissipate as the year goes on.

And the ramp development by Kiena by the conjunction with two last drills, I think it's going to be fairly even to be honest with the drill.

Okay, great. I'll make this last one but you mentioned the potential for beating reserve grade at Eagle River, can you expect the same kind of beat that we saw in Q1?

Well, I got Phil in the room, I think we can turn that over to Phil.

We are looking at similar levels, so for the balance of the year. So, its cautiously optimistic on what we can accomplish there.

Okay, great. Thanks a lot guys I appreciate that.

Thank you.