Jamie Porter - Chief Financial Officer John McCluskey - President and Chief Executive Officer Peter MacPhail - Vice President and Chief Operating Officer.

Rahul Paul - Canaccord Genuity Mike Parkin - Desjardins Kerry Smith - Haywood Securities Lawson Winder - Bank of America Don MacLean - Paradigm.

Good morning. I would now like to turn the meeting over to Mr. Jamie Porter, Chief Financial Officer. Please go ahead..

Thank you, operator, and thanks, everyone, for attending Alamos' First Quarter 2017 Conference Call. In addition to myself, we have on the line today, John McCluskey, President and CEO; and Peter MacPhail, Vice President and COO. I would like to remind everyone that our presentation will be followed by a Q&A session.

On this call, we will be making forward-looking statements. Please refer to the disclaimer of forward-looking statements in our news release and MD&A, as well as the risk factors set out in our annual information form. All forward-looking statements on this call are qualified by these cautionary statements.

There can be no assurance that our forward-looking statements, even though considered reasonable by management and based on information on hand, will prove to be accurate. Future results and events could differ materially.

Technical information in this presentation has been reviewed and approved by Chris Bostwick, our Vice President of Technical Services and a qualified person. Also, please bear in mind that all of the dollar amounts mentioned in this conference call are in U.S. dollars, unless otherwise noted. Now John will provide you with an overview.

John?.

Thank you, Jamie, and good morning, everyone. The first quarter of 2017 was marked by a number of positive developments. We produced 96,200 ounces of gold at all-in sustaining costs of $1,014 per ounce.

With higher production and lower costs expected for the remainder of the year, we remain on track to meet our full year production guidance of 400,000 to 430,000 ounces and all-in sustaining cost guidance of $940 per ounce.

We expect this to drive significant free cash flow growth from our operations, especially in the second half of the year, as several projects are completed.

This includes the addition of the pebble crusher at Young-Davidson and completion of the MCM waste pass, which will allow for higher mining rates; and at Mulatos, the completion of construction and initial production from Phase I of La Yaqui. Mulatos and El Chanate both had strong starts for the year.

At Young-Davidson, underground mining rates were at the lower end of the range of full year guidance as we caught up in development and waste tons in the quarter. There was also a 3,000-ounce buildup of inventory within the mill circuit that was not recorded in production.

This is just a timing issue, with these ounces to be recovered in the coming months. We expect stronger production and lower costs from Young-Davidson in the second quarter and the rest of the year as underground mining rates trend higher. We're expecting excellent progress with the development of La Yaqui Phase I.

We remain on schedule and on budget and expect initial production in the second half of this year, an impressive result, considering we started construction this January. At La Yaqui Grande, we continue to demonstrate growth, having reported an initial reserve of over 500,000 ounces with our year-end reserve update.

La Yaqui Grande is a bigger project and will have a longer development time line, but the rapid progress we've made on Phase I demonstrates how quickly we're able to advance these type of projects around the Mulatos district. We've made significant headway in Turkey to start this year.

We received the Forestry Permits for Kirazli in January and published feasibility studies on Kirazli and Agi Dagi and the preliminary economic assessment on Çamyurt in February, outlining extremely attractive economics and the potential to deliver significant production and free cash flow growth.

We are currently pursuing the GSM permit for Kirazli and have increased our capital budget and expect to spend up to $30 million in 2017. This will be spent on completing detailed engineering and early construction activities on some of the longer lead time items, including the water reservoir. Financially, we're well positioned to fund our growth.

Using proceeds of the equity financing completed in February and existing cash, we retired all of the outstanding $315 million of high-yield notes in April. We are now debt-free and have eliminated $24 million in annual interest costs.

We have also greatly strengthened and improved our balance sheet flexibility such that we are much better positioned to fund our portfolio of high return for internal growth projects, starting with Kirazli. And with that, I will turn the call over to Jamie Porter, our CFO, who will comment on first quarter 2017 financial performance.

Jamie?.

Thank you, John. We sold 98,800 ounces of gold in the first quarter at an average realized price of $1,225 per ounce for revenues of $121 million. Consolidated total cash costs were $827 per ounce and all-in sustaining costs of $1,014 per ounce. All 3 of our operations generated positive free cash flow in the quarter before changes in working capital.

We expect strong free cash flow growth through the rest of the year driven by higher production and lower costs. As John noted, we expect the bulk of this to come in the second half of the year, reflecting higher mining rates at Young-Davidson and additional low cost production from La Yaqui Phase I.

Our net earnings in the quarter were $0.1 million or $0.00 per share, including an unrealized foreign exchange gain of $5.9 million or $0.02 per share. Operating cash flow before changes in noncash working capital is $34.2 million or $0.12 per share. Capital spending of $34 million was in line with plans for the quarter.

This included $9 million of sustaining capital and $24 million of growth capital. This also included $5 million of development spending in La Yaqui Phase I, which, as John mentioned, remains on budget.

Our corporate G&A expense in the quarter was $3.7 million, consistent with full year guidance, which at $16 million is among the lowest of our peer group. Amortization expense was $28 million, consistent with the year ago, though slightly lower on a per ounce basis at $288 per ounce.

At the end of March, we had $495 million of cash and equity securities, up substantially from the end of 2016, reflecting the net proceeds from the equity financing completed in the quarter of $240 million. In April, we used proceeds of the financing and existing cash to retire the $315 million high-yield notes.

Our total cash outflow to retire the notes was $327 million, which included the prepayment premium. We also paid our final semiannual interest payment of $12 million. We expect to record an after-tax charge in the second quarter of approximately $25 million related to the retirement of these notes.

This includes a $12 million prepayment premium and other noncash charges totaling approximately $13 million. The retirement of these notes will save us $24 million in annual interest costs and $72 million over the remaining term of the notes. This has also greatly strengthened and unencumbered our balance sheet. We’re now debt free.

We have a healthy cash position and additional liquidity available through our $150 million revolving credit facility. We are in a much better positioned to fund one of the most attractive growth pipelines for our peer group. At this point, I'd like to turn the call over to Alamos' COO, Peter MacPhail, to provide an overview of operations..

Thank you, Jamie. Young-Davidson produced 40,400 ounces of gold in the first quarter, a total cash cost of $710 per ounce and all-in sustaining costs of $851 per ounce. There was buildup of approximately 3,000 ounces of gold in inventories within the mill during the quarter.

Including these ounces, production would have been approximately 43,400 ounces. This is just a timing issue, with those ounces to recover from inventory over the coming months.

Underground mining rates averaged 6,400 tons per day in the quarter, consistent with the low end of the range of full year guidance of 6,500 to 7,500 tons per day as development and waste tons were caught up in the quarter.

Mining rates improved later in the quarter and are expected to trend higher throughout the year, especially after the completion of the MCM waste pass early in the third quarter. This will drive stronger production and lower costs through the rest of the year, consistent with guidance.

Underground mined grades were 2.56 grams per ton, slightly lower than the reserve grade due to mine sequencing. Grades are expected to increase in the second quarter, with higher grades still scheduled to be mined. As a reminder, while we expect mined grades to average the reserve grade 2.7 grams per ton for the full year.

We do expect earnings of up to 10% quarter-to-quarter. Mill throughput increase averaged 7,700 per day in the first quarter, up from 7,300 per day a year ago. Grades processed through the mill averaged 2.18 grams per ton, up from 2.08 grams per ton a year ago, with higher-grade underground ore comprising a greater proportion of the mill feed.

We expect to see a further increase in processed rates for the remainder of the year, reflecting the higher grades still to be mined and higher underground mining rate. Additionally, we expect stronger mill throughput later in the year, with the new pebble crusher to be operational in the fourth quarter.

Mill recoveries of 89% were in line with the year ago and are expected to increase to a range of 90% to 92% for the rest of the year. Mulatos performed well in the first quarter with production of 40,000 ounces as total cash costs of $827 per ounce and all-in sustaining costs of $920 per ounce.

The mine generated $8.8 million in free cash flow before working capital changes and excluding $5.3 million of development capital spend at La Yaqui. Total cash costs are expected to trend lower through the year, reflecting a lower strip ratio and initial production from La Yaqui.

We expect to see this drive strong free cash flow growth in the second half of the year. Total crusher throughput averaged a record 19,100 tons per day in the quarter, above full year guidance and up from 18,000 tons per day a year ago. Grade stacked of 0.86 grams per ton were also up from a year ago, consistent with guidance.

The waste-to-ore ratio of 1:1 was down sharply from a year ago and expected to trend lower throughout the year. The high-grade mill in Mulatos performed as expected, with throughput averaging 400 tons per day at an average grade of 8.9 grams per ton.

This exceeded underground mining rates from San Carlos, with the deposit expected to reach the end of its reserve life around the middle of this year.

Our high-grade stockpile supplemented underground production during the quarter, and with approximately 40,000 tons remaining, these stockpiles will continue to supplement mill production into the second half of 2017.

With the aim of extending the mine life at San Carlos beyond 2017, we initiated an underground exploration program in the eastern zone of the deposit during the second quarter. We're also looking at initiating drilling at El Refugio later this year as enough potential source of high-grade mill feed.

El Chanate produced 15,800 ounces in the first quarter. Total cash costs were $1,144 per ounce, and all-in sustaining costs were $1,187 per ounce. Strip ratio was elevated in the first quarter at 7:1 as part of the scheduled pushback.

Pushback is expected to be completed mid-2017, after which, the strip ratio will drop significantly in the second half of the year. Given the long-lead cycles at El Chanate, we do not expect significant impact at quarterly production and costs.

As previously disclosed, with El Chanate being a mature, higher cost operation, we've executed on a hedging strategy to preserve free cash flow. Approximately 80% of the mine's 2017 production has been hedged, ensuring a minimum gold price of $12.25 per ounce and participation up to a price of $14.50 per ounce.

Shifting over to our growth projects, we are currently expanding our team in Turkey with the hiring of key personnel who will oversee construction of Kirazli.

We've expanded our budget for the year and expect to spend up to $30 million on preconstruction activities, including starting work on the water reservoir, detailed engineering and other critical path items.

Lynn Lake, our focus during the quarter was completing the project description, which kicks off permitting process while also working towards the completion of the feasibility study for the third quarter. Development of La Yaqui Phase I is on track and on budget.

We spent $5 million on construction activities during the first quarter, with a number of milestones achieved. We've obtained all significant permits required for construction and operations, including explosive permit.

We're nearing completion of the process funds and the initial heap leach pad, and we started mining activities and stockpiling of ore at the crusher. I was at the site a few weeks ago, and this is really starting to look like a mine.

We expect to spend an additional $7 million in order to complete construction in the third quarter, to be followed by commissioning and initial production. Development of La Yaqui has gone very smoothly thus far, and we're very pleased with the progress in such a short period of time.

We'll look to replicate this success as we develop our other projects within the Mulatos district. With that, I'll turn the call back to John..

Thank you very much, Peter. I'll now ask the operator to open the lines for our question-and-answer segment.

Operator?.

Thank you [Operator Instructions] The first question is from Rahul Paul of Canaccord Genuity. Please go ahead..

Hi everyone.

At San Carlos, are you mining outside of reserves right now? If so, how much?.

Yes, some of the - Rahul, it's Peter. Some of the mining that we're doing is outside of our reserve and even perhaps resource as we kind of mine out towards the eastern part of the orebody or the eastern part of the mineralized area. We're still mining in reserve in the western part or the main zone, and we continue to follow, update up to the east.

And we're now actually driving a bit of an exploration drive so that we can kind of get decided and drill out ahead of us..

Okay, thanks.

So basically, the exploration that you're doing to extend the reserve life or mine life there is based on some indication that there is actually mineralization there right now?.

That's right. I mean, we have had hits in the east zone from surface several years ago, and it was identified. And at this point, we're going to try and give some tighter space drilling in there and see what we really have..

Okay. And at Kirazli, you've increased your budget, you've started hiring people to oversee the construction.

Have you had any discussions with the authorities that give you confidence the GSM permit is coming soon? And how much money would you be willing to spend before the permit is officially in hand?.

So, Rahul, it's Jamie. I'll just comment on the last part of your question. Of the $30 million budget that we have for Turkey this year, about $10 million would be committed in advance of receipt of the GSM permit.

John, do you have any comments in terms of timing?.

I would just say that in the conversations that I had with the cabinet level officials while I was in Turkey in February, indicated that our GSM permit would be fast-tracked after the referendum was completed. Of course, the referendum occurred two-weeks ago.

And right now, we are in direct discussions with the Governor's office with respect to getting the process started, whereby they begin the review of the detailed engineering work and final site, if you want to call it, site disturbance area. They've got to review all that, very similar to getting a building permit anywhere in the world.

They want to take a detailed look at what we're going to do, and they will be in a position to sort of go through the review. We've been told in the past, that review takes about 5-weeks, and then sometime thereafter, probably within the month following that review, we would expect to receive the GSM permit.

So, I'm quite hopeful that we'll see the permit by the early summer..

Okay, thanks John that’s good to know. That’s all that I had..

Thank you. The following question is from Mike Parkin of Desjardins. Please go ahead..

Thanks for taking my questions guys. Just some kind of housekeeping bits.

On Young-Davidson, can you just remind us which quarters you'd expect to have major shutdowns in and how many days would those be?.

I think what we had said in the guidance time was that we were expecting up to a 4-day shutdown of the hoisting facility to do a road change. That's been pushed out. It was looking like, what could have been in the first quarter, we've not pushed that out. And we're actually hopeful that it doesn't even have to happen at all this year.

So really depends on where it cared on, on the ropes. But right now, it's looking good to push that out. So it would not be any quarter it would have a major - potentially not any quarter it would have a major shutdown..

Okay, good. So no - not good.

And then on San Carlos, with what you know in terms of what you've got in a reserve block, plus what you've got in stockpile, where do you see that asset ending today?.

We see it getting into the fourth quarter. Whether it gets all the way to the fourth quarter depends on a little bit of what happens in this as we continue to mine outside of a reserve. But given the reserve and the stockpile gets us to - if we have no further success, probably gets us to kind of October or so..

Okay. And then can you just give a little bit of color on the mining costs in Canadian dollars or why be there at $47 this quarter, up from $42 in Q4, such as sequencing that between development scoping or....

It really boiled down to how much of the development we're doing is actually capital development versus operating development. When you look at the all-in sustaining costs, it's flat.

If you look at our sustaining capital, it will be lower than it was a year ago, and it's just shifting money from sustaining capital development into property development..

Yes. The other factor there was the Canadian dollar strengthening, and it gets strength by about 4% compared in Q1 of 2016 to Q1 of 2017..

Okay. That’s it from me guys, thanks very much..

Thanks Mike..

Thank you. The following question is from Kerry Smith of Haywood Securities. Please go ahead..

Thanks operator.

Peter, the catch-up you were trying to get caught up on YD on the development and the waste tonnages that you need to do, is that kind of caught up now or would we expect to see some more value in Q2 and then by the time we get to Q3, it'd be back on track with higher ore tonnages [indiscernible] surface?.

Yes. So we did 6,400 tons a day of ore of the shafts. Our guidance was 65 to 75, with the lower end being at the beginning. So yes, we missed by 100 tons a day. We actually - we moved a lot of waste during the quarter. We averaged over 8,000 tons a day of the mid-shaft. More on waste so kind of 1,600 tons a day or so of waste.

So getting that MCM waste pass in place and being able to move that waste through the MCM side, which is actually underutilized currently, you can see how that's going to be a big, big help. That level be early in Q3..

Right, okay. Okay.

So, I guess Q2 would likely be at the lower end of your current guidance now?.

It will be under 7,000, between 6,500 and 7,000, I would say..

Okay. Okay. And can you quantify a bit more of the - with the pebble crusher in the mill and the increase in throughput, is that pebble crusher going to get you up to around the 8,000 ton a day or was that likely to get you higher? I forget exactly what you had said. I'm just trying to....

I mean, it'll be - it'll allow us to get to 8,000 tons a day. I mean, we do 7,700 kind of currently, so that's not a big boost. It wouldn't allow us to do more likely than - quite likely than 8,000 tons a day.

Our long-term - our medium-term mining rates from underground will be 8,000 tons a day because we'll get the lower mine built out a couple of years from now.

And in the meantime, we can process remaining low-grade stockpile if we have one on surface as well as the buildup of scats that have - scats being stuffed that gets kind of rejected from the mill prior to having pebble crusher today. So it's kind of built up with that stuff, and we would start [indiscernible]..

Okay. Okay. And last thing, just on the underground exploration that you are planning to do at San Carlos. When - it sounds like you had to do some kind of an underground drive.

So it might be a while before we actually get results? Is that sort of a late Q2 or Q3?.

We'll be starting drilling there relatively soon to drive - this is actually in place. So it will take - I think we just have 1 rig working on it, so it will be success-driven and starting as we go there. So over the course of the coming months or quarters, we'll be able to update on that..

Okay.

But the drive is already in then?.

Yes..

Okay, okay great. Sorry, I missed that. Okay that’s great. Thanks very much..

[Operator Instructions] The following question is from Lawson Winder of Bank of America. Please go ahead..

Hi gentlemen. Just quickly on the working capital increase in the quarter.

I was curious, is that something you would expect to continue increasing through the year or reverse and unwind through the rest of the year?.

Yes. So, Lawson, it's Jamie. There's a couple of things there. I mean, in the first quarter, we paid down our payables, but we built up our receivables and net inventory just to some extent. I would think our - that should level off through the rest of the year.

I think we'll get - we'll catch up on our receivables in Mexico and - yes, so I wouldn't expect out big of a swing through the remaining course of 2017 as we had in Q1..

Okay, got it. Thanks for that. And then, Jamie, actually, you mentioned - when you talked about the cash, you mentioned the equity securities.

I was just curious, do you guys view those equity securities as a source of funding?.

Well, so I mentioned equity securities, and that's because that's how they're now classified in our financial statements. We actually - we early adopted - I do GAAP pronouncement IFRS 9 in the quarter, and that resulted in our changing the classification of AuRico Metals and other holdings from these, we called available through sales securities.

They're now called equity securities. We do consider those as a potential source of funding, but we certainly have no current intent to dispose many of those positions..

Okay. Got it. And then just an update on the land availability at Mulatos.

So with regards to the priority targets that you guys have for 2017, it was like Los Baijos, El Carricito, Halcon, a few others, which ones do you still not yet have access rights to?.

Yes, it's Peter here. So Baijos were - is mostly on - or all on a property that's part of the Bajios that we have an agreement with. Parts of North - La Yaqui Norte and Halcon are on private ranch ownership where we have various forms of agreement. And yes, Carricito is private ranch.

So where we don't have service rights, we have, in some cases, agreements to do exploration work. In other cases, we're still looking for those agreements. But I would say that our success in getting those agreements over the last - demonstrates success over the last year, is pretty good, and we don't have any current concerns about getting that..

Yes, we're focused currently on Bajios and Refugio. We've got full access there. So it's Carricito and Yaqui Norte where there's some additional - agreement withstanding, those will come later this year..

Okay, that’s great. That’s it from me guys. Thanks very much..

Thank you. The following question is from Don MacLean of Paradigm. Please go ahead. Don MacLean, your line is now open. If you are using a speaker phone, please lift up the handset or unmute your line..

Hello can you hear me now?.

Okay. Technical difficulties. Just a few questions. One, Lynn Lake, there's a little bit of discussion about it. But the feasibility is moving along.

Can you give us a bit of color about how that - what it's shaping up like?.

Yes, hi Don, Peter. It's shaping up to be two open pits. As you may know, one is called MacLellan, the other one is called Gordon. It had been called Farley in the past, changed that name. There's no surprises from what Carlisle would have had on it other than they were pretty skimpy on CapEx.

Certainly, the CapEx they were showing, whatever it was, $150 million, to get it going was light, so didn't expect that obviously higher. Build the mill probably at 7,000 tons a mill or thereabouts tailing facility.

2 pits, the higher-grade pit being Gordon, trucking from that one, Highway Haulers, it's about, I don't know, 50 kilometers or thereabouts away. Yes, pretty simple, really..

And I think in our discussions along the way, the - notwithstanding the higher CapEx, it still look like a viable project in kind of gold region we are now..

Yes, that hasn't changed. I mean, all these - the numbers only come in at the end of these studies. But we're - keep [indiscernible] along the way. We're not seeing any [indiscernible] place or anything like that. We - there's probably still some optimization to do a lot of things to get it right. But we're checking through that..

Great.

So, so far, so good?.

Yes..

Now there was also some discussion about the Mulatos exploration, but nothing in particular seem to stand out. But that's at a quick scan.

Anything that, Peter, you could talk about that struck you from the quarterly exploration?.

We seem to get always have a slow start. And after the vacation period in Mexico, we usually change our drill - tender new drill contractors. And by the time you get going, you're halfway through the quarter, and that was - I would say that was the case this year. We're drilling [indiscernible] in La Yaqui currently.

We have some hits, we have some misses. So it's shaping up probably like we would have expected..

Okay. Great. And then lastly, maybe, Jamie, if you could give us a little bit more granularity or a little bit of the shape of the profile for cash flow, free cash flow this year this year..

Certainly. So I think - I mean, based on our guidance, we were looking for cash flow from [indiscernible] of around $50 million for the year, at $30 million from Mulatos and Chanate, so $80 million inside free cash flow to $12.50 bulk price. I think we'll likely be a little bit lower than that.

We'll probably be somewhere in the 60s, but it's highly dependent on the timing of Yaqui Phase I coming on as when we can ramp up to that’s closer to 7,500 tons per day at YD. The gold price has fallen off a little bit here. We're still generating strong free cash flow [indiscernible] $13 million before working capital changes in Q1.

So we'd expect that to increase through the remaining course of this year, but Q3 and Q4 should be the strongest, certainly..

Great, okay. Thanks. Very helpful guys..

Thank you. [Operator Instructions] There are no further questions at this time. This concludes this morning's call. If you have any further questions that have not been answered, please feel free to contact Mr. Scott Parsons at 416-368-9932, extension 5439..