Ms. Jody Kuzenko reports

TOREX GOLD PROVIDES 2024 OPERATIONAL GUIDANCE AND UPDATED FIVE-YEAR PRODUCTION OUTLOOK

Torex Gold Resources Inc. has provided 2024 operational guidance, as well as an updated five-year production outlook, for the Morelos complex, which includes the ELG mine complex and the Media Luna project.

Jody Kuzenko, president and chief executive officer of Torex, stated: "Two thousand twenty-four will be a transformational year for Torex as we wind down the ELG open pits, continue steady production from ELG underground, commence stope mining at Media Luna, complete an internal economic study on developing EPO and further bolster our ongoing drilling success, all while running one of the safest operations in the industry. With 2024 expected to be the final year of significant investment in the Media Luna project, Torex is well positioned to return to positive free cash flow in 2025.

"Gold equivalent production in 2024 is guided at 410,000 to 460,000 ounces, which is modestly stronger than the 400,000 to 450,000 ounces forecast in the previous five-year production outlook. Lower production year over year reflects a one-month shutdown of the processing plant during [fourth quarter] to complete the upgrades and tie-ins necessary to start processing ore from Media Luna and producing copper concentrate.

"All-in sustaining costs in 2024 are guided at $1,130 to $1,190 per ounce AuEq sold, highlighting the outlook for robust margins and cash flow generation again this year, particularly if the price of gold remains at current levels. This strong projected cash flow, combined with over $500-million of available liquidity at the end of September, places Torex on solid footing to fully fund Media Luna internally ($508-million remaining at the end of [third quarter]), continue meaningful investment in drilling and maintain at least $100-million of cash on the balance sheet.

"In addition to releasing 2024 guidance, we have updated and extended our five-year production outlook to 2028. Gold equivalent production through 2027 remains consistent with the previous five-year outlook with average annual production of over 450,000 ounces. For 2028, gold equivalent production is forecast at 350,000 to 400,000 ounces, which is materially higher than the 337,000 ounces estimated in the 2022 technical report, reflecting the benefit of reserve additions over the last two years. Work to strengthen the longer-term production outlook for Morelos in 2028 and beyond is ongoing -- in 2024, this will include completing an internal prefeasibility study on EPO and continuing to aggressively drill off ELG underground.

"With an exceptionally strong fourth quarter just behind us and strong momentum coming into 2024, we are well positioned to deliver on production and cost expectations, bring Media Luna into production by year-end, and demonstrate the potential to further strengthen the long-term production and free cash flow profile of the Morelos complex."

Starting in 2024, Torex plans to begin reporting production, sales, total cash costs and all-in sustaining costs on a gold equivalent basis, which reflects the projected increase in copper and silver production with the start-up of Media Luna. Production and sales by individual metal will continue to be reported as will byproduct total cash costs and all-in sustaining costs for 2024.

2024 production guidance

Gold equivalent production in 2024 is guided at 410,000 to 460,000 ounces including 400,000 to 450,000 ounces of gold. The modest improvement in gold equivalent production relative to the previous five-year outlook reflects a greater contribution from ELG underground as the targeted mining rate of 2,000 tonnes per day was achieved about a year ahead of schedule.

The mine plan for 2024 includes a full year of production scheduled from ELG, with the open pits starting to wind down midyear and ELG underground maintaining consistent levels of production throughout the year. Ore production from Media Luna starts in second quarter and continues to ramp up thereafter. The surplus ore mined in 2024 provides contingency and optionality for the commissioning schedule of the Media Luna surface infrastructure, including upgrades and tie-ins to the processing plant.

From a processing perspective, gold equivalent production is expected to be relatively consistent through the first three quarters of the year, with the lowest quarter of production being fourth quarter given the planned one-month shutdown of the processing plant. During the shutdown, upgrades to the processing plant will be carried out as part of the Media Luna project, including the tie-in of the copper and iron sulphide flotation circuits, regrind mills, and water treatment plant, as well as the installation of a variable speed drive on the ball mill.

The level of copper and silver produced is expected to increase significantly in Q4 following the commissioning of the new processing plant infrastructure. Based on the current project schedule, the first sale of copper concentrate is anticipated to occur before year-end.

2024 cost guidance

Total cash costs on a gold equivalent basis are guided at $900 to $950 per ounce gold equivalent sold during 2024 and $860 to $910 per ounce Au sold on a byproduct basis (net of copper and silver revenue). Total cash costs (byproduct basis) are modestly higher than guided in 2023. This primarily reflects the lower forecast production year over year given the planned one-month shutdown of the processing plant during Q4 and initial start-up costs related to Media Luna. Total cash costs (byproduct basis) in 2023 are expected to be at the upper end of the guided range of $840 to $870 per ounce Au sold for the full year.

All-in sustaining costs on a gold equivalent basis are guided at $1,130 to $1,190 per ounce AuEq sold during 2024 and $1,100 to $1,160 per ounce Au sold on a byproduct basis. All-in sustaining costs (byproduct basis) are modestly lower than guided in 2023, primarily reflecting a significant decline in capitalized waste stripping with completion of the layback last September. All-in sustaining costs (byproduct basis) in 2023 are expected to be at the upper end of the guided range of $1,160 to $1,200 per ounce Au sold for the full year.

The midpoint of cost guidance for 2024 assumes an average Mexican peso to U.S. dollar of 18 to 1 for the full year. Similar to last year, a one-Mexican-peso change relative to the U.S. dollar has an approximate $10-million impact on operating costs.

2024 capital expenditure guidance

Total sustaining capital expenditures in 2024 are guided at $55-million to $65-million, including $5-million of capitalized stripping.

Sustaining capital expenditures are guided at $50-million to $60-million in 2024, lower than the $60-million to $70-million guided in 2023, which included approximately $10-million of one-time power-related projects. Excluding the one-time power costs, sustaining capital expenditures (excluding capitalized waste stripping) are consistent with 2023 and include $30-million of development in ELG underground, $10-million for plant maintenance and $5-million in lease-related payments.

The significant decrease in capitalized waste stripping relative to the $55-million to $65-million guided in 2023 reflects a significantly lower strip ratio year over year in the ELG open pits (4.6 versus 8.6) and a greater proportion of waste stripping expensed versus capitalized given the completion of a layback last year.

Total non-sustaining capital expenditures are guided at $360-million to $415-million in 2024, which include $350-million to $400-million on account of Media Luna compared with $360-million to $390-million guided in 2023. Expenditures on Media Luna are expected to remain relatively consistent through Q3 before declining in Q4 as development activities wind down ahead of commissioning in Q4. The $50-million range reflects year-end carry-over potential both in 2023 and in 2024, given that commercial production is anticipated in early 2025. The remaining expenditures are related to drilling within the Media Luna cluster.

2024 drilling and exploration plans

Torex plans to invest approximately $30-million in drilling and exploration in 2024 and an additional $5-million for grade control and definition drilling. In total, 96,500 metres of drilling is planned for 2024 with the goal of increasing reserves and resources to maintain the current production profile beyond 2027 and extend the overall reserve life of the Morelos complex beyond 2033. Details of the planned exploration programs are as follows:

• Media Luna cluster: Approximately $15-million is earmarked for drilling at the Media Luna cluster (39,000 metres). The 2024 program includes $10-million for infill and expansionary drilling at EPO (24,000 metres) in support of completing a prefeasibility study during the second half of the year. Based on the success of a small program at Media Luna West last year, follow-up drilling (12,000 metres, expensed) is planned in 2024 to better understand the resource potential of the target. In addition, an inaugural drilling program (3,000 metres, expensed) is planned at Todos Santos, which is a high-priority target located between ELG and Media Luna.
• ELG underground: Approximately $12-million is budgeted for infill and stepout drilling at ELG underground (54,500 metres) with the goal of continuing to add reserves and extend the life of the operation. The multipronged program will be focused on defining the high-grade potential along El Limon Sur and El Limon Deep trends, as well as extending high-grade resources within the Sub-Sill and El Limon West trends.
• Morelos district: Approximately $3-million is earmarked to conduct near-mine and regional exploration and drilling (3,000 metres) across the Morelos property. The focus of this program is to drill test a potential cluster of mineralization at El Naranjo target located northwest of EPO and to further explore a selection of new targets identified near ELG and within the Atzcala area.

For 2024, approximately $10-million to $15-million of drilling- and exploration-related expenditures have been included in non-sustaining capital expenditure guidance, and $5-million has been included in sustaining capital expenditure guidance. The remaining expenditures are expected to be classified as exploration expenses.

Five-year production outlook (2024 to 2028)

Apart from the modest improvement to 2024 production guidance, there have been no changes to the production outlook through 2027. In 2028, gold equivalent production is forecast to be between 350,000 and 400,000 ounces, which are materially higher than the 337,000 ounces outlined in the technical report. The improved outlook in 2028 relative to the technical report reflects the benefit of reserve additions over the last two years, which has pushed out the processing of lower-grade stockpiles to mid-2030 from late 2027.

A breakdown of Torex's mineral reserves and resources as at Dec. 31, 2022, can be found in the press release dated March 28, 2023, titled "Torex Gold Reports Year-End 2022 Reserves & Resources," found on the company's website.

Cash flow seasonality

Per usual, there will be seasonality in cash flow. In first quarter, cash flow from operations will be impacted by the payment of the Mexican-based mining tax (accrued throughout the year and paid out the following March) and corporate income tax owing at year-end. Taxes paid will be reflected in cash flow from operations prior to changes in non-cash working capital. In second quarter, cash flow from operations after changes in non-cash working capital will be impacted by the employee profit-sharing payment, which is accrued throughout the year and paid out in full in May of the following year.

Unlike in prior years, cash flow from operations is also expected to be lower during Q4, which is anticipated to be the lowest quarter of production given the planned shutdown of the processing plant to complete upgrades and tie-ins to begin processing ore from Media Luna.

Additional gold price protection secured for 2024

As part of the company's continuing work to reduce price risk during the buildout of Media Luna, Torex has placed additional forward sales contracts in Q3 2024, increasing the gold volume from 27,000 ounces to 44,000 ounces. This brings the total volume of gold hedged to 158,000 ounces for the year at an average price of $1,972 per ounce.

As reported in Q3 2023, the company has also entered into a series of foreign exchange zero-cost collars whereby it sold call option contracts and purchased put option contracts for nil cash premium to hedge against changes in foreign exchange rates of the Mexican peso. This was to protect the exposure of peso-denominated expenditures for the Media Luna project. At this time, there have been no changes to the hedges put in place compared with what was previously reported.

About Torex Gold Resources Inc.

Torex is an intermediate gold producer based in Canada, engaged in the exploration, development and operation of its 100-per-cent-owned Morelos property, an area of 29,000 hectares in the highly prospective Guerrero gold belt located 180 kilometres southwest of Mexico City. The company's principal asset is the Morelos complex, which includes El Limon Guajes mine complex, the Media Luna project, a processing plant and related infrastructure. Commercial production from the Morelos complex commenced on April 1, 2016, and an updated technical report for the Morelos complex was released in March, 2022. Torex's key strategic objectives are to optimize and extend production from the ELG mine complex, derisk and advance Media Luna to commercial production, build on environmental, social and governance excellence, and grow through continuing exploration across the entire Morelos property.

Qualified person

The technical and scientific information in this press release, with respect to the company's 2024 production outlook and strip ratio, as well as five-year production outlook, has been reviewed and approved by Richard Jundis, PEng, principal mining engineer, technical services and capital projects, of the company, and a qualified person under National Instrument 43-101.

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