DPM Metals Inc. — Interim / Quarterly Report 2021

Jul 29, 2021

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MANAGEMENT’S DISCUSSION AND ANALYSIS

of Consolidated Financial Condition and Results of Operations for the Three and Six Months Ended June 30, 2021

(All monetary figures are expressed in U.S. dollars unless otherwise stated)

TABLE OF CONTENTS

OVERVIEW…………………………………………………………..	2 SELECTED QUARTERLY INFORMATION..……....................……….	43
REVIEW OF FINANCIAL AND OPERATIONAL CONSOLIDATED RESULTS.	7 CRITICAL ACCOUNTING ESTIMATES……………………….….......	43
THREE-YEAR OUTLOOK……………………………………………..	13 NON-GAAPFINANCIAL MEASURES………………...…………......	44
REVIEW OF OPERATING RESULTS BY SEGMENT…………………….	18 RISKS AND UNCERTAINTIES..……………………….....................	50
REVIEW OF CORPORATE&OTHER SEGMENT RESULTS...................	26 DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL
REVIEW OF DISCONTINUED OPERATIONS……………………………	26CONTROL OVER FINANCIAL REPORTING……………………………	51
LIQUIDITY AND CAPITAL RESOURCES………………………………..	27 CAUTIONARY NOTE REGARDING FORWARD LOOKING
FINANCIAL INSTRUMENTS……………………………………………	32STATEMENTS………………………………………………………..	52
EXPLORATION…………………………………………...................	35 CAUTIONARY NOTE TO UNITED STATES INVESTORS CONCERNING
DEVELOPMENT AND OTHER MAJOR PROJECTS……………………...	41DIFFERENCES IN REPORTING OF MINERAL RESOURCE ESTIMATES...	54
OFF BALANCE SHEET ARRANGEMENTS..…….................................	42

The following is Management’s Discussion and Analysis (“MD&A”) of the consolidated financial condition and results of operations of Dundee Precious Metals Inc. (“DPM” and, together with its consolidated subsidiaries, collectively referred to as the “Company”) as at June 30, 2021 and for the three and six months ended June 30, 2021. This MD&A should be read in conjunction with DPM’s unaudited condensed interim consolidated financial statements for the three and six months ended June 30, 2021 prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board. Additional Company information, including the Company’s most recent annual information form (“AIF”) and other continuous disclosure documents, can be accessed through the System for Electronic Document Analysis and Retrieval (“SEDAR”) website at www.sedar.com and the Company’s website at www.dundeeprecious.com. To the extent applicable, updated information contained in this MD&A supersedes older information contained in previously filed continuous disclosure documents. Capitalized terms used in this MD&A that have not been defined have the same meanings attributed to them in DPM’s unaudited condensed interim consolidated financial statements for the three and six months ended June 30, 2021. Information contained on the Company’s website is not incorporated by reference herein and does not form part of this MD&A. This MD&A contains forward looking statements that are based on certain estimates and assumptions and involve risks and uncertainties. Actual results may vary materially from management’s expectations. See the “Cautionary Note Regarding Forward Looking Statements” and “Risks and Uncertainties” sections later in this MD&A for further information.

The technical and scientific information in this MD&A, with respect to the Company’s material mineral projects, has been prepared in accordance with Canadian regulatory requirements set out in National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) of the Canadian Securities Administrators and the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Definition Standards for Mineral Resources and Mineral Reserves, and has been reviewed and approved by Ross Overall, B.Sc. (Applied Geology), Corporate Mineral Resource Manager of DPM, who is a Qualified Person as defined under NI 43-101 (“QP”), and who is not independent of the Company.

This MD&A has been prepared as at July 29, 2021.

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OVERVIEW

Our Business

DPM is a Canadian based, international gold mining company engaged in the acquisition of mineral properties, exploration, development, mining and processing of precious metals. Its common shares (symbol: DPM) are traded on the Toronto Stock Exchange (“TSX”).

The Company’s purpose is to unlock resources and generate value to thrive and grow together. As illustrated in the graphic below, this overall purpose is supported by a foundation of core values, which guide how the Company conducts its business and informs a set of complementary strategic pillars and objectives relating to Environmental Social Governance (“ESG”), innovation, optimizing our existing portfolio, and growth. The Company’s resources are allocated in-line with its strategy to ensure that DPM delivers value for all of its stakeholders.

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DUNDEE PRECIOUS METALS INC. | 2

Continuing Operations :

As at June 30, 2021, DPM’s principal subsidiaries include:

• 100% of Dundee Precious Metals Chelopech EAD (“Chelopech”), which owns and operates a gold, copper and silver mine located east of Sofia, Bulgaria;

• 100% of Dundee Precious Metals Krumovgrad EAD (“Ada Tepe”), which owns and operates a gold mine located in south eastern Bulgaria, near the town of Krumovgrad; and

• 92% of Dundee Precious Metals Tsumeb (Proprietary) Limited (“Tsumeb”), which owns and operates a custom smelter located in Tsumeb, Namibia.

As at June 30, 2021, DPM holds interests, directly or indirectly, in a number of exploration properties located in Serbia, Canada, Bulgaria and Ecuador including:

• 100% of Avala Resources d.o.o. (“Avala”), which is focused on the exploration and development of the Timok gold project in Serbia;

• 8.9% of Sabina Gold & Silver Corp. (“Sabina”), which is focused on the development of the Back River project in southwestern Nunavut, Canada; and

• 23.5% of INV Metals Inc. (“INV”), which is focused on the development of the Loma Larga gold project located in Ecuador. On July 26, 2021, DPM completed the acquisition of the remaining portion of INV not already held by DPM, and now owns 100% of INV.

Discontinued Operations :

On May 3, 2021, DPM sold 73.7% of MineRP Holdings Inc. (“MineRP”), which owns MineRP Holdings (Proprietary) Limited, an independent mining software vendor with operations in Canada, South Africa, Australia and Chile (“MineRP Disposition”). As a result of the MineRP Disposition, DPM no longer owns any shares of MineRP and the assets and liabilities of MineRP have been presented as held for sale in the consolidated statement of financial position as at December 31, 2020, and the operating results and cash flows of MineRP have been presented as discontinued operations in the condensed interim consolidated statements of earnings (loss) and cash flows for the three and six months ended June 30, 2021 and 2020. As a consequence, certain comparative figures in the condensed interim consolidated statements of earnings (loss) and cash flows have been reclassified to conform with current period presentation.

All operational and financial information contained in this MD&A are related to continuing operations, unless otherwise stated.

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Overview – Operational and Financial Highlights

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Revenue
($mm)
154 156 152 175
138
Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021
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Cost of Sales
($mm)
90
83 80 81 86
Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021
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Cash Provided from Operating Activities and Free Cash Flow[(1)]

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1,835 1,816 1,779 1,803
1,649
73 76
71 67
62
60
51
48
42
39
Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021
Cash from Operating Activities ($mm)
Free Cash Flow ($mm)
Average Realized Gold Price ($/ounce)(1)
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Complex Concentrate Smelted
('000s tonnes)
Planned
major furnace
maintenance
59 60
56
52
23
Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021
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Gold Production and Payable Gold Sold ('000s ounces)

Copper Production and Payable Copper Sold (mm pounds)

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85
81 80
10
71 69 70 69 70 9 10 9
64 63 8 8 8 8
7 7
Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021 2020 2020 2020 2021 2021
Production Payable Sold Production Payable Sold
All-in Sustaining Cost [[(1)]] and Net Cash [(2)]
Cash Cost, Net of By-product ($mm)
Credits [[(1)]] ($/ounce)
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Cash Cost Complex All-in Sustaining Cost [[(1)]] and
Concentrate Smelted, Net of Cash Cost, Net of By-product
By-product Credits [(1)] Credits [[(1)]] ($/ounce)
($/tonne)
967
Planned 729
major furnace maintenance 640 651 605
522
407 406 400
345
530
441 425 390 430
Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021 2020 2020 2020 2021 2021
All-in Sustaining Cost
Cash Cost, Net of By-product Credits
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260
176
150
101
75
Q2 Q3 Q4 Q1 Q2
2020 2020 2020 2021 2021
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Net Earnings Attributable to Common Shareholders from Continuing Operations ($mm)

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9.2 3.3 2.2 1.7 (1.1) (1.6) (1.7) (2.2) (2.9) (6.9)
23.0 67.1 0.4 67.5
48.0 (3.9) 44.1
Q2 2020 Q2 2020 Q2 2020 Metal prices General and Metal Other Depreciation Volumes Volumes Operating Income Treatment Weaker Q2 2021 Q2 2021 Q2 2021
net earnings adjustments adjusted net administrative recoveries of metals of complex costs taxes charges and U.S. adjusted net adjustments net earnings
attributable to earnings(1) expenses sold concentrate other selling dollar(3) earnings(1) attributable to
common smelted costs common
shareholders shareholders
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Net Earnings Attributable to Common Shareholders from Continuing Operations ($mm)

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48.7 7.4 1.7 (2.1) (2.8) (3.0) ( 3.7 ) (6.2)
(8.9)
(25.7)
93.7 (1.0) 92.7 98.1 (9.9) 88.2
June YTD 2020 2020 2020 Metal General and Depreciation Operating Other Volumes Treatment Income Weaker Volumes 2021 2021 June YTD 2021
net earnings adjustments adjusted net prices administrative costs of metals charges and taxes U.S. of complex adjusted net adjustments net earnings
attributable to earnings(1) expenses sold other selling dollar(3) concentrate earnings(1) attributable to
common costs smelted common
shareholders shareholders
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• 1) Free cash flow; average realized gold price; cash cost per tonne of complex concentrate smelted, net of by-product credits; all-in sustaining cost per ounce of gold; cash cost per ounce of gold, net of by-product credits; and adjusted net earnings are not defined measures under IFRS. Refer to the “Non-GAAP Financial Measures” section contained in this MD&A for more information, including reconciliations to IFRS measures.

• 2) Net cash represents cash less total debt at the end of each reporting period. The Company had no debt at the end of all reporting periods presented above. 3) Includes net realized gains and losses on foreign exchange option contracts.

Response to Coronavirus (“COVID-19”)

In March 2020, the World Health Organization classified the COVID-19 epidemic as a worldwide pandemic and governments across the globe undertook extensive measures to combat the spread of this virus. To date, as a result of the proactive actions being taken within the regions in which we operate and by personnel at each of our sites, the Company has not experienced any material disruptions to its operations as a result of COVID-19. The Company’s Chelopech and Ada Tepe mines in Bulgaria continue to operate at full capacity and have not experienced any disruptions to their operations.

As previously reported, the Tsumeb smelter in Namibia curtailed its operations by shutting down ancillary plants for 30 days in April 2020 in response to a government directive to the natural resources sector aimed at limiting staffing levels. Full operations resumed in May 2020 with ongoing management of the number of employees and contractors working at site and continued observance of the COVID-19 controls that have been established across all sites. Tsumeb’s maintenance shutdown, which was originally planned for 30 days in the first quarter of 2021, was extended to 45 days in part as a result of COVID-19 related safety protocols, travel restrictions and the use of remote commissioning support. Namibia is currently experiencing its third wave of COVID-19 with the onset of the cold season intensified by the Delta variant.

The Company continues to closely assess and monitor the COVID-19 situation, particularly as governments in various jurisdictions maintain and/or implement new measures to manage a resurgence in the number of cases and the impact on their medical systems and economies. The Company is continuing with a number of measures to mitigate the associated risks, including procedures and contingency plans that were established at each operating location, which are directed at safeguarding employees, managing potential supply chain disruptions and maintaining production at each of its operations. These precautionary steps

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include, but are not limited to, the use of personal protective equipment, workplace and social distancing practices, remote and rotational working options, health hygiene protocols, elimination of non-essential business travel and site access and widespread education of the Company’s workforce.

Management of the situation is being overseen by an experienced cross-functional team that includes members of senior management and leaders at each of the Company’s operations. DPM continues to engage with local communities and authorities in Bulgaria, Namibia and Serbia as they respond to the challenges of the pandemic. The Company will also be ensuring appropriate measures are being taken to manage COVID-19 impacts and assessing its ability to support the local communities and authorities, following the completion of its acquisition of the Loma Larga gold project in Ecuador. To date, the Company has contributed approximately $1.0 million to support numerous COVID-19 related initiatives to benefit local communities. This financial support has focused on local hospitals to provide additional medical facilities, supplies, transportation and protective equipment.

The Company has experienced several positive cases of COVID-19 within its workforce. Positive cases are being effectively managed with testing, contact tracing and isolation measures and, to date, the vast majority of employees have recovered with the remaining employees isolating offsite in accordance with the Company’s procedures. Given the relatively low number of COVID-19 cases and the management protocols in effect, the impact on the Company’s operations has been minimal. Multiple COVID-19 variants have emerged and are circulating globally. These variants spread more easily and quickly than the original virus resulting in a surge in number of cases, including in regions in which the Company operates.

Certain vaccines have received regulatory approval in the countries in which the Company operates, and the respective governments are progressing vaccination of their populations based on risk-assessed phased approaches which vary from country to country. Vaccine distribution is a significant logistical undertaking and the timing and speed of vaccination in each jurisdiction is uncertain at this time and will depend on several factors including supply of the vaccines.

At present, there do not appear to be any imminent COVID-19 related circumstances that are expected to disrupt the Company’s operations, however, given the highly uncertain and evolving nature of this situation, the Company is not able to reliably estimate the likelihood, timing, duration, severity and scope of this pandemic and the potential impact it could have on the Company’s operating and financial results. There is no assurance that the pandemic will not have a material adverse impact on the future results of the Company.

Summary of significant operational and financial highlights

In the second quarter of 2021, the Company achieved record quarterly gold production, free cash flow and net earnings reflecting continued strong operating performance at Chelopech and Ada Tepe, combined with strong gold prices. Production at Chelopech increased significantly compared with the prior quarter, as a result of mining higher grade zones and improved recoveries, while Ada Tepe’s strong gold production was in line with plan. The Tsumeb smelter delivered solid performance, with complex concentrate smelted increasing compared with the prior quarter, following completion of the planned Ausmelt furnace maintenance in March 2021. With strong performance in the first half of the year, the Company is on track to meet its previously issued guidance for 2021 at each of its operations.

Net earnings attributable to common shareholders from continuing operations in the second quarter of 2021 were $67.5 million compared to $48.0 million in the corresponding period in 2020. This increase was due primarily to higher realized gold and copper prices and lower general and administrative expenses related to share-based compensation as a result of changes in DPM’s share price, partially offset by a weaker U.S. dollar.

Net earnings attributable to common shareholders from continuing operations in the first six months of 2021 were $88.2 million compared to $93.7 million in the corresponding period in 2020. This decrease was due primarily to the maintenance shutdown at Tsumeb, a weaker U.S. dollar and higher income taxes reflecting higher earnings, partially offset by higher realized gold and copper prices.

Cash resources, including DPM’s long-term revolving credit facility (“RCF”), were $410.5 million as at June 30, 2021.

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REVIEW OF FINANCIAL AND OPERATIONAL CONSOLIDATED RESULTS

The followingtables summarize the Company’sselectedfinancialand operational results:	The followingtables summarize the Company’sselectedfinancialand operational results:	The followingtables summarize the Company’sselectedfinancialand operational results:
$ thousands, unless otherwise indicated Ended June 30,	Three Months	Six Months
	2021 2020	2021 2020
Financial Results Revenue Cost of sales Depreciation and amortization General and administrative expenses Corporate social responsibility expenses Exploration and evaluation expenses Finance cost Other (income) expense Earnings before income taxes Income tax expense Net earnings attributable to common shareholders from continuing operations Net earnings attributable to common shareholders(1) Basic earnings per share from continuing operations Basic earnings per share(1) Adjusted EBITDA(2) Adjusted net earnings Adjusted basic earnings per share(2) Cash provided from operating activities Free cash flow Capital expenditures incurred: Growth(2) Sustaining(2) Total capital expenditures	174,736 154,028 89,941 82,941 24,247 26,031 2,982 12,179 654 757 5,055 3,914 1,314 1,709 (142) (433) 74,932 52,961 7,443 4,926 67,502 48,047 88,153 48,870 0.37 0.27 0.48 0.27 100,632 77,608 67,116 44,098 0.37 0.25 75,697 73,595 67,045 59,868 3,901 1,359 11,893 10,261 15,794 11,620	312,766 301,815 175,584 169,865 48,425 50,087 6,847 14,150 1,133 1,480 9,685 7,659 2,717 3,928 6,591 389 110,209 104,344 22,006 10,620 88,221 93,748 108,215 92,041 0.49 0.52 0.60 0.51 166,797 158,179 98,138 92,754 0.54 0.52 123,288 84,590 118,052 110,301 5,492 4,106 29,333 17,096
		34,825 21,202
Operational Highlights Metals contained in concentrate produced: Gold_(ounces) Copper(‘000s pounds) Payable metals in concentrate sold: Gold(ounces) Copper(‘000s pounds) Cash cost per ounce of gold sold, net of by-product credits All-in sustaining cost per ounce of gold Complex concentrate smelted at Tsumeb(mt)_ Cash cost per tonne of complex concentrate smelted,net ofby-product credits	85,128 81,365 10,013 9,378 70,430 70,838 9,468 8,543 430 530 605 729 59,627 58,516 400 345	155,386 154,328 17,187 18,759 138,997 139,092 16,747 18,063 429 521 583 662 82,636 123,526 558 352
As at,		June 30, 2021 December 31,2020
Financial Position and Available Liquidity Cash Investments at fair value Total assets Total equity Number of common shares outstanding_(‘000s)_ Share price (Cdn$ per share) Availableliquidity(3)		260,455 149,532 76,911 106,595 1,030,546 974,860 866,726 805,284 182,030 181,400 7.51 9.15 410,455 299,532

1) These measures include discontinued operations.

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2) Adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”); adjusted basic earnings per share; growth and sustaining capital expenditures are not defined measures under IFRS. Refer to the “Non-GAAP Financial Measures” section of this MD&A for more information, including reconciliations to IFRS measures.

3) Available liquidity is defined as undrawn capacity under DPM’s RCF plus cash at the end of each reporting period.

Commodity prices and foreign exchange rates

Commodity prices are one of the principal determinants of the Company’s results of operations and financial condition. In addition, as an entity reporting in U.S. dollars with operations in several countries, fluctuations in foreign exchange rates between the U.S. dollar and the Bulgarian lev, which is pegged to the Euro, the Namibian dollar, which is pegged to the South African rand (“ZAR”) on a 1:1 basis, and the Canadian dollar (“Cdn$”) can also impact the Company’s results of operations and financial condition.

The following table summarizes the average trading price for gold and copper based on the London Bullion Market Association (“LBMA”) for gold and the London Metal Exchange (“LME”) for copper (Grade A) for the three and six months ended June 30, 2021 and 2020 and highlights the overall year over year change in commodity prices.

Metal Market Prices (Average) Ended June 30,	Three Months 2021 2020 Change	Six Months 2021 2020 Change
LBMA gold_($/ounce) LMEsettlement copper($/pound)_	1,815 1,710 6% 4.40 2.42 82%	1,808 1,647 10% 4.12 2.49 65%

The average realized gold price for the second quarter and first six months of 2021 of $1,803 per ounce and $1,791 per ounce, respectively, was 9% and 12% higher than the corresponding periods in 2020. The average realized copper price for the second quarter and first six months of 2021 of $3.99 per pound and $3.89 per pound, respectively, was 69% and 58% higher than the corresponding periods in 2020.

As at June 30, 2021, approximately 100% of projected payable copper to be sold over the balance of 2021 has been hedged with an average hedge price of $3.77 per pound.

Average realized gold and copper prices are not defined measures under IFRS. Refer to the “Non-GAAP Financial Measures” section contained in this MD&A for more information, including reconciliations to IFRS measures.

The following table sets out the average foreign exchange rates for the principal currencies impacting the Company and highlights the overall year over year weakness of the U.S. dollar relative to these currencies.

Average Foreign Exchange Rates Ended June 30,	Three Months 2021 2020 Change	Six Months 2021 2020 Change
US$/Cdn$ Euro/US$ US$/ZAR	1.2279 1.3859 (11%) 1.2047 1.1011 (9%) 14.1256 17.9483 (21%)	1.2472 1.3651 (9%) 1.2052 1.1010 (9%) 14.5363 16.6492 (13%)

As at June 30, 2021, approximately 79% of projected Namibian dollar operating expenses for the balance of 2021 have been hedged with option contracts providing a weighted average floor price of 15.65 and a weighted average ceiling price of 18.69.

Metals production

Gold contained in concentrate produced in the second quarter of 2021 increased by 5% to 85,128 ounces due primarily to higher gold grades as a result of mining higher grade zones and improved recoveries at Chelopech, and copper production increased by 7% to 10.0 million pounds due primarily to higher copper grades and recoveries, partially offset by lower ore processed, in each case, relative to the corresponding period in 2020.

Gold contained in concentrate produced in the first six months of 2021 of 155,386 ounces was comparable to the corresponding period in 2020 reflecting higher gold grades offset by lower ore processed, and copper

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production decreased by 8% to 17.2 million pounds due primarily to lower copper grades, relative to the corresponding period in 2020.

Metals sold

Payable gold in concentrate sold in the second quarter of 2021 of 70,430 ounces was comparable to the corresponding period in 2020. Payable copper in concentrate sold in the second quarter of 2021 of 9.5 million pounds was 11% higher than the corresponding period in 2020 consistent with the increase in copper production as a result of higher copper grades and recoveries.

Payable gold in concentrate sold in the first six months of 2021 of 138,997 ounces was comparable to the corresponding period in 2020. Payable copper in concentrate sold in the first six months of 2021 of 16.8 million pounds was 7% lower than the corresponding period in 2020 consistent with the decrease in copper production as a result of lower copper grades.

Complex concentrate smelted

Complex concentrate smelted at Tsumeb during the second quarter of 2021 of 59,627 tonnes was comparable to the corresponding period in 2020. Complex concentrate smelted at Tsumeb during the first six months of 2021 of 82,636 tonnes was 33% lower than the corresponding period in 2020 due primarily to the planned Ausmelt furnace maintenance shutdown, which was completed during the first quarter of 2021.

Revenue

Revenue in the second quarter of 2021 of $174.7 million was $20.7 million higher than the corresponding period in 2020 due primarily to higher realized metal prices. Revenue in the first six months of 2021 of $312.7 million was $10.9 million higher than the corresponding period in 2020 due primarily to higher realized metal prices, partially offset by lower volumes of complex concentrate smelted at Tsumeb as a result of the planned Ausmelt furnace maintenance completed in the first quarter of 2021.

Cost of sales

Cost of sales in the second quarter and first six months of 2021 of $89.9 million and $175.5 million, respectively, was $7.0 million and $5.7 million higher than the corresponding periods in 2020 due primarily to a weaker U.S. dollar relative to the ZAR and Euro and higher royalties at Ada Tepe reflecting a higher profit-based royalty rate.

All-in sustaining cost per ounce of gold

All-in sustaining cost per ounce of gold in the second quarter and first six months of 2021 of $605 and $583, respectively, was 17% and 12% lower than the corresponding periods in 2020 due primarily to higher byproduct credits reflecting higher copper prices and lower allocated general and administrative expenses, partially offset by a stronger Euro relative to the U.S. dollar and higher cash outlays for sustaining capital expenditures.

Cash cost per tonne of complex concentrate smelted, net of by-product credits

Cash cost per tonne of complex concentrate smelted in the second quarter of 2021 of $400 was $55 higher than the corresponding period in 2020 due primarily to a stronger ZAR relative to the U.S. dollar and lower acid by-product credits as a result of the timing of deliveries. Cash cost per tonne of complex concentrate smelted in the first six months of 2021 of $558 was $206 higher than the corresponding period in 2020 reflecting the fixed cost nature of the facility and the impact of lower volumes of complex concentrate smelted resulting from the longer-than anticipated maintenance shutdown, which was completed during the first quarter of 2021, combined with a stronger ZAR relative to the U.S. dollar.

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General and administrative expenses

General and administrative expenses in the second quarter and first six months of 2021 were $3.0 million and $6.9 million, respectively, compared to $12.2 million and $14.2 million in the corresponding periods in 2020 due primarily to lower share-based compensation related to DPM’s share price during these periods, partially offset by higher professional fees mainly related to digital initiatives.

Exploration and evaluation expenses

Exploration and evaluation expenses in the second quarter and first six months of 2021 were $5.1 million and $9.7 million, respectively, compared to $3.9 million and $7.6 million in the corresponding periods in 2020 due primarily to increased drilling activities on potential targets in priority areas at Chelopech, Ada Tepe and Timok.

For a more detailed discussion on the Company’s exploration activities, refer to the “Exploration” section contained in this MD&A. For a more detailed discussion on the Timok gold project, refer to the “Development and Other Major Projects” section contained in this MD&A.

Finance costs

Finance costs are comprised of interest and other deemed financing costs in respect of the Company’s debt, prepaid forward gold sales arrangement, lease obligations and rehabilitation provisions.

Finance costs in the second quarter and first six months of 2021 were $1.3 million and $2.7 million, respectively, compared to $1.7 million and $3.9 million in the corresponding periods in 2020. These decreases were due primarily to interest accretion pursuant to the prepaid forward gold sales arrangement recognized in the second quarter and first six months of 2020. The Company completed its final delivery of gold under this arrangement in December 2020.

Other (income) expense

Other (income) expense is primarily comprised of unrealized gains or losses on Sabina special warrants and foreign exchange translation gains or losses.

The following table summarizes the items making up other (income) expense:

$ thousands Ended June 30,	Three Months Six Months
	2021 2020 2021 2020
Net (gains) losses on Sabina special warrants(1) Net foreign exchange (gains) losses(2) Interest income Other, net	231 (3,069) 5,630 (114) 340 2,362 1,205 (208) (92) (24) (184) (66) (621) 298 (60) 777
Totalother(income) expense	(142) (433) 6,591 389

1) Refer to the “Financial Instruments” section contained in this MD&A for more details.

2) Primarily related to the revaluation of foreign denominated monetary assets and liabilities.

Income tax expense

The effective tax rate of the Company can vary significantly from one period to the next based on a number of factors. For the three and six months ended June 30, 2021 and 2020, the Company’s effective tax rate was impacted primarily by the Company’s overall earnings, mix of foreign earnings or losses, which are subject to lower tax rates in certain jurisdictions, and changes in unrecognized tax benefits relating to corporate operating, exploration and evaluation costs, as well as unrealized gains or losses on the Company’s publicly traded securities recognized in other comprehensive income (loss).

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$ thousands, unless otherwise indicated Ended June 30,	Three Months Six Months
	2021 2020 2021 2020
Earnings before income taxes Combined Canadian federal and provincial statutory income tax rates	74,932 52,961 110,209 104,344 26.5% 26.5% 26.5% 26.5%
Expected income tax expense Lower rates on foreign earnings Changes in unrecognized tax benefits Non-taxable portion of capital (gains) losses Non-deductible share-based compensation expense Other,net	19,857 14,035 29,205 27,651 (12,429)(10,623) (18,474) (21,950) (216) 1,984 8,536 4,301 (378) (952) 1,798 (51) 69 62 135 124 540 420 806 545
Income taxexpense	7,443 4,926 22,006 10,620
Effectiveincome tax rates	9.9% 9.3% 20.0% 10.2%

In December 2020, the Namibian Ministry of Finance announced that tax incentives under the Export Processing Zones (“EPZ”) Act would no longer be granted, effective December 31, 2020, and that companies with EPZ status, such as Tsumeb, would continue to benefit from these incentives up to December 31, 2025. The EPZ regime is expected to be replaced by a new Special Economic Zone (“SEZ”), a draft of which is expected to be released in the second half of 2021.

Net earnings attributable to common shareholders from continuing operations and adjusted net earnings

Net earnings attributable to common shareholders from continuing operations in the second quarter of 2021 were $67.5 million ($0.37 per share) compared to $48.0 million ($0.27 per share) in the corresponding period in 2020 due primarily to higher realized gold and copper prices and lower general and administrative expenses related to share-based compensation as a result of changes in DPM’s share price. Net earnings attributable to common shareholders from continuing operations in the first six months of 2021 were $88.2 million ($0.49 per share) compared to $93.7 million ($0.52 per share) in the corresponding period in 2020 due primarily to the planned Ausmelt maintenance shutdown at Tsumeb in 2021, a weaker U.S. dollar and higher income taxes reflecting higher earnings, partially offset by higher realized gold and copper prices.

Adjusted net earnings in the second quarter and first six months of 2021 were $67.1 million ($0.37 per share) and $98.1 million ($0.54 per share), respectively, compared to $44.1 million ($0.25 per share) and $92.7 million ($0.52 per share) in the corresponding periods in 2020. These increases were due primarily to the same factors affecting net earnings attributable to common shareholders from continuing operations, with the exception of the adjusting items detailed below.

Adjusted net earnings in the second quarter and first six months of 2021 excluded unrealized losses on Sabina special warrants of $0.3 million (2020 – unrealized gains of $3.0 million) and $5.6 million (2020 – unrealized gains of $0.1 million), respectively, and deferred income tax recovery adjustment not related to current period earnings of $0.6 million (2020 – $0.9 million) and deferred income tax expense adjustment of $4.3 million (2020 - deferred income tax recovery adjustment of $0.9 million), respectively, both of which are not reflective of the Company’s underlying operating performance. For more details on these adjustments, refer to the “Non-GAAP Financial Measures” section contained in this MD&A.

The following table summarizes adjusted net earnings (loss) by segment:

$ thousands Ended June 30,	Three Months Six Months
	2021 2020 2021 2020
Chelopech Ada Tepe Tsumeb Corporate & Other	40,587 28,813 73,536 58,565 26,875 26,555 54,449 44,493 6,087 5,319 (14,369) 12,640 (6,433) (16,589) (15,478) (22,944)
Totaladjustednet earnings	67,116 44,098 98,138 92,754

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Adjusted EBITDA

Adjusted EBITDA in the second quarter and first six months of 2021 was $100.6 million and $166.8 million, respectively, compared to $77.6 million and $158.2 million in the corresponding periods in 2020 reflecting the same factors that affected adjusted net earnings, except for interest, income tax, depreciation and amortization, which are excluded from adjusted EBITDA.

The following table summarizes adjusted EBITDA by segment:

$ thousands Ended June 30,	Three Months Six Months
	2021 2020 2021 2020
Chelopech Ada Tepe Tsumeb Corporate & Other	50,077 39,414 93,025 79,801 43,778 44,051 91,230 77,051 12,555 10,059 (3,308) 22,496 (5,778) (15,916) (14,150) (21,169)
TotaladjustedEBITDA	100,632 77,608 166,797 158,179

The “Corporate & Other” segment in the adjusted net earnings (loss) and adjusted EBITDA tables above includes corporate general and administrative expenses, corporate social responsibility expenses, exploration and evaluation expenses, and other income and expense items that do not pertain directly to an operating segment.

For a more detailed discussion of Chelopech, Ada Tepe, Tsumeb and Corporate & Other results, refer to the “Review of Operating Results by Segment” section contained in this MD&A.

Cash provided from operating activities

Cash provided from operating activities in the second quarter of 2021 of $75.7 million was $2.1 million higher than the corresponding period in 2020 due primarily to the fulfillment of the prepaid forward gold sales agreement at Ada Tepe in December 2020 and higher realized gold and copper prices, partially offset by an unfavourable period over period change related to working capital. Cash provided from operating activities in the first six months of 2021 of $123.3 million was $38.7 million higher than the corresponding period in 2020 due primarily to a favourable period over period change related to working capital, the fulfillment of the prepaid forward gold sales agreement at Ada Tepe in December 2020 and higher realized gold and copper prices, partially offset by lower volumes of complex concentrate smelted as a result of the planned Ausmelt furnace maintenance shutdown at Tsumeb in 2021.

During the second quarter and first six months of 2020, Ada Tepe delivered 6,992 ounces and 20,102 ounces of gold, respectively, pursuant to the prepaid forward gold sales arrangement which resulted in $9.6 million and $27.5 million of deferred revenue being recognized in revenue during the second quarter and first six months of 2020, respectively, with no corresponding impact on cash as these deliveries were in partial satisfaction of the $50.0 million of upfront proceeds received in 2016. In December 2020, the Company completed its final delivery of gold under this arrangement.

For a detailed discussion on the factors affecting cash provided from operating activities, refer to the “Liquidity and Capital Resources” section contained in this MD&A.

Free cash flow

Free cash flow in the second quarter of 2021 was $67.1 million compared to $59.9 million in the corresponding period in 2020 due primarily to higher realized gold and copper prices including the fulfillment of the prepaid forward gold sales agreement at Ada Tepe in December 2020, partially offset by higher cash outlays for sustaining capital expenditures.

Free cash flow in the first six months of 2021 was $118.1 million compared to $110.3 million in the corresponding period in 2020 due primarily to higher realized gold and copper prices including the fulfillment of the prepaid forward gold sales agreement at Ada Tepe in December 2020, partially offset by lower

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volumes of complex concentrate smelted as a result of the maintenance shutdown at Tsumeb in 2021 and higher cash outlays for sustaining capital expenditures.

Capital expenditures

Capital expenditures incurred during the second quarter and first six months of 2021 were $15.8 million and $34.8 million, respectively, compared to $11.6 million and $21.2 million in the corresponding periods in 2020.

Sustaining capital expenditures incurred during the second quarter and first six months of 2021 were $11.9 million and $29.3 million, respectively, compared to $10.3 million and $17.1 million in the corresponding periods in 2020. These increases were due primarily to the planned maintenance shutdown at Tsumeb and accelerated grade control drilling at Ada Tepe. Growth capital expenditures incurred during the second quarter and first six months of 2021 were $3.9 million and $5.5 million, respectively, compared to $1.3 million and $4.1 million in the corresponding periods in 2020.

THREE-YEAR OUTLOOK

DPM continues to focus on increasing the profitability of its business by optimizing existing operating assets, which are expected to maintain higher levels of gold production and declining all-in sustaining costs per ounce of gold as highlighted in the 2021 to 2023 outlook and supplemental detailed 2021 guidance below.

2021 to 2023 Outlook

The outlook is based on historical performance and experience at DPM’s operations and is consistent with the production schedules outlined in the technical report for Chelopech entitled “NI 43-101 Technical Report - Mineral Resource and Reserve Update, Chelopech Mine, Chelopech, Bulgaria” dated March 30, 2020 (the “Chelopech Technical Report”), and the technical report for Ada Tepe entitled “NI 43-101 Technical Report – Mineral Reserve and Mineral Resource Update for the Ada Tepe Mine, Krumovgrad, Bulgaria” dated November 23, 2020 (the “Ada Tepe Technical Report”). For 2022 and 2023, all production and cost estimates do not yet incorporate any cost savings, operating performance improvements in respect of mine and smelter throughput and potential improvements to mine grades and recoveries. The Chelopech Technical Report and the Ada Tepe Technical Report have been filed on SEDAR (www.sedar.com) and are available on the Company’s website (www.dundeeprecious.com).

The three-year outlook previously issued in February 2021 remains unchanged, except for the 2021 guidance in respect of complex concentrate smelted, which was revised in the first quarter of 2021 as a result of the longer than anticipated shutdown and additional maintenance activities at Tsumeb, and growth capital expenditures, which has been updated to include the estimated costs related to advancing the Loma Larga gold project acquired in July 2021.

Highlights of the three-year outlook include:

• Continued solid gold production : Over the next three years, gold production is expected to average approximately 280,000 ounces per year based on current mine plans. Gold production is expected to range between 271,000 and 317,000 ounces in 2021, between 240,000 and 280,000 ounces in 2022, and between 265,000 and 310,000 ounces in 2023.

• Stable copper production : Copper production between 2021 and 2023 is expected to be approximately 35 million pounds per year, based on current mine plans.

• Attractive all-in sustaining cost: All-in sustaining cost per ounce of gold is expected to range between $625 and $695 in 2021, between $730 and $810 in 2022, and between $630 and $710 in 2023. The year over year variations in all-in sustaining cost reflect expected gold grades in concentrate produced and volumes of gold-copper concentrate delivered to third party smelters.

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• Stable smelter performance: Annual estimates for complex concentrate smelted vary due to the timing of scheduled furnace maintenance shutdowns. During the first quarter of 2021, Tsumeb completed a scheduled furnace maintenance shutdown and resumed full operations at the end of March 2021. The maintenance shutdown, which was originally planned for 30 days, was extended to 45 days. The longer-than-planned timeline was primarily a result of COVID-19 related safety protocols, travel restrictions and the use of remote commissioning support, as well as a decision to increase the scope of the maintenance work around the Ausmelt lining replacement and additional converter maintenance. During the first quarter of 2021, DPM revised its 2021 guidance for Tsumeb to a range of 200,000 to 220,000 tonnes of complex concentrate smelted from the previous range of 220,000 to 250,000 tonnes issued in February 2021 to reflect the impact of the extended shutdown and additional maintenance activities. Cash cost per tonne of complex concentrate smelted in 2021 is expected to range between $450 and $520 per tonne, unchanged from the previously issued guidance for 2021. Complex concentrate smelted and cash cost per tonne of complex concentrate smelted remain unchanged in 2022 and 2023 from the outlook provided in February 2021.

• Sustaining capital expenditures trending lower: Sustaining capital expenditures for 2021 are expected to range between $56 million and $72 million, up from $41 million in 2020 as a result of initiating an accelerated life of mine grade control drilling program at Ada Tepe, which was originally planned to occur over several years and was previously classified as an operating cost, as well as investments to upgrade Chelopech’s tailings management facility following completion of the work to extend its life in 2019 and 2020, and the furnace maintenance shutdown at Tsumeb, which occurred in the first quarter of 2021. Following 2021, sustaining capital expenditures are expected to trend lower, with 2022 sustaining capital expenditures expected to range between $38 million and $50 million, and 2023 to further decline to a range of $33 million to $44 million.

The Company’s three-year outlook is set out in the following table:

$ millions, Unless otherwise indicated	2021 Guidance 2022 Outlook 2023 Outlook
Gold contained in concentrate produced_(‘000s ounces)(1),(2) Chelopech Ada Tepe Total Copper contained in concentrate produced(million pounds) Chelopech All-in sustaining cost per ounce of gold(3) Complex concentrate smelted(‘000s tonnes)_ Cash cost per tonne of complex concentrate smelted(3) Sustaining capital expenditures(3) Chelopech Ada Tepe Tsumeb Corporate digital initiatives	156 – 176 145 – 165 150 – 170 115–141 95–115 115–140
	271 – 317 240 – 280 265 – 310 34 – 39 32 – 39 32 – 39 625 – 695 730 – 810 630 – 710 200 – 220 220 – 250 230 – 265 450 – 520 450 – 520 420 – 490 20 – 25 14 – 18 9 – 12 16 – 21 6 – 8 6 – 8 16 – 20 16 – 20 16 – 20 4 –6 2 – 4 2 – 4
Consolidated	56– 72 38–50 33– 44

• 1) Gold produced includes gold in pyrite concentrate produced of 50,000 to 56,000 ounces for 2021, and 46,000 to 52,000 ounces in each of 2022 and 2023.

• 2) Metals contained in concentrate produced are prior to deductions associated with smelter terms.

• 3) All costs and capital expenditures are based on, where applicable, a Euro/US$ exchange rate of 1.18, a US$/ZAR exchange rate of 16.00, a copper price of $3.68 per pound in 2021 and $3.00 per pound in each of 2022 and 2023, and an average acid price of $74 per tonne in 2021 and $45 per tonne in each of 2022 and 2023, and have not been adjusted for inflation in 2022 and 2023.

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The Company’s detailed guidance for 2021 is set out in the following table:

$ millions,				Consolidated
unless otherwise indicated	Chelopech	Ada Tepe	**Tsumeb **	Guidance
Ore processed_(‘000s tonnes)_	2,090 - 2,200	835 - 925	-	2,925 - 3,125
Cash cost per tonne of ore processed(3),(4)	42 - 45	46 - 50	-	-
Metals contained in concentrate produced(1),(2)
Gold_(‘000s ounces)_	156 - 176	115 - 141	-	271 - 317
Copper_(million pounds)_	34 - 39	-	-	34 - 39
Payable metals in concentrate sold(1)
Gold_(‘000s ounces)_	130 - 147	113 - 138	-	243 - 285
Copper_(million pounds)_	31 - 36	-	-	31 - 36
All-in sustaining cost per ounce of gold(3)	685 - 755	560 - 630	-	625 - 695
Complex concentrate smelted_(‘000s tonnes)_	-	-	200 - 220	200 - 220
Cash cost per tonne of complex concentrate
smelted, net of by-product credits(3)	-	-	450 - 520	450 - 520
Corporate general and administrative
expenses(3),(5)	-	-	-	19 - 23
Exploration expenses(3)	-	-	-	13 - 15
Evaluation expenses(3)	-	-	-	2 - 3
Sustaining capital expenditures(3),(6)	20 - 25	16 - 21	16 - 20	56 - 72
Growthcapitalexpenditures(3),(7)	2 - 4	-	3- 4	21 - 28

• 1) Gold produced includes gold in pyrite concentrate produced of 50,000 to 56,000 ounces and payable gold sold includes payable gold in pyrite concentrate sold of 31,000 to 35,000 ounces.

• 2) Metals contained in concentrate produced are prior to deductions associated with smelter terms.

• 3) Based on a Euro/US$ exchange rate of 1.18, a US$/ZAR exchange rate of 16.00, a copper price of $3.68 per pound and an average acid price of $74 per tonne, where applicable.

• 4) Cash cost per tonne of ore processed is a Non-GAAP measure and has no standardized meaning under IFRS. Refer to the “Non-GAAP Financial Measures” section of this MD&A for more information.

• 5) Excludes mark-to-market adjustments on share-based compensation.

• 6) Consolidated sustaining capital expenditures include $4 million to $6 million related to corporate digital initiatives.

• 7) Consolidated growth capital expenditures include the estimated costs related to the FS (as defined herein) for the Timok gold project of $11 million to $13 million and the estimated costs related to the technical and permitting work for the Loma Larga gold project of $5 million to $7 million (as detailed below).

The foregoing three-year outlook and supplemental detailed 2021 guidance are not expected to occur evenly throughout the year. The estimated metals contained in concentrate produced, payable metals in concentrate sold and volumes of complex concentrate smelted are expected to vary from quarter to quarter depending on the areas being mined, the timing of concentrate deliveries and planned outages, including furnace maintenance shutdowns at Tsumeb. The rate of capital expenditures is also expected to vary from quarter to quarter based on the schedule for, and execution of, each capital project.

Additional detail on the Company’s three-year outlook is set out below:

Chelopech

Based on Chelopech’s current mine plans, gold contained in concentrate produced is expected to range between 156,000 and 176,000 ounces in 2021, between 145,000 and 165,000 ounces in 2022, and between 150,000 and 170,000 ounces in 2023.

Copper contained in concentrate produced in 2021 is expected to be between 34 and 39 million pounds and is expected to be between 32 and 39 million pounds in each of 2022 and 2023.

In 2021, cash cost per tonne of ore processed is expected to be at the higher end of 2021 guidance due primarily to higher electricity rates, a weaker U.S. dollar and higher royalties.

Sustaining capital expenditures in 2021 are expected to be between $20 million and $25 million, including approximately $5 million for the next phase of work to upgrade Chelopech’s tailings management facility. Growth capital expenditures related to resource development drilling and margin improvement projects are expected to be between $2 million and $4 million in 2021. Sustaining capital expenditures are expected to trend lower starting in 2022, ranging between $14 million and $18 million, including approximately $3 million

DUNDEE PRECIOUS METALS INC. | 15

to complete the upgrade of the tailings management facility. In 2023, sustaining capital expenditures are expected to decline to between $9 million and $12 million.

Ada Tepe

Gold contained in concentrate produced in 2021 is expected to be between 115,000 and 141,000 ounces, which is 8% higher than 2020 based on the mid-point of 2021 guidance. This increase is due primarily to higher gold grades and is consistent with the updated life of mine plan. Gold contained in concentrate produced is expected to be between 95,000 and 115,000 ounces in 2022, and between 115,000 and 140,000 ounces in 2023.

In 2021, cash cost per tonne of ore processed is expected to be at the higher end of 2021 guidance due primarily to higher royalties, higher electricity rates and a weaker U.S. dollar.

Sustaining capital expenditures in 2021 are expected to be between $16 million and $21 million, reflecting an accelerated grade control drilling program in order to provide representative and high quality samples for better grade control and mine planning over the life of mine. Sustaining capital expenditures are expected to decline to between $6 million and $8 million in 2022 and remain at this level in 2023.

Tsumeb

As a result of the extended shutdown and additional maintenance activities, 2021 guidance for complex concentrate smelted was revised in the first quarter of 2021 to a range of 200,000 to 220,000 tonnes from the range of 220,000 to 250,000 tonnes previously issued in February 2021. Based on an expected 18month operating cycle, complex concentrate smelted in 2022 is expected to range between 220,000 and 250,000 tonnes. In 2023, complex concentrate smelted is expected to range between 230,000 and 265,000 tonnes as a result of no planned furnace maintenance shutdown in that year. Concentrate feed is currently contracted through to the third quarter of 2023 with additional feed thereafter expected to be contracted in the normal course.

In 2021, cash cost per tonne of complex concentrate smelted, net of by-product credits, is expected to range between $450 and $520 per tonne, unchanged from the previously issued guidance for 2021. In 2022, cash cost per tonne of complex concentrate smelted, net of by-product credits, is expected to range between $450 and $520 per tonne. In 2023, cash cost per tonne of complex concentrate smelted, net of by-product credits, is expected to range between $420 and $490 per tonne as a result of increased throughput.

Sustaining capital expenditures in 2021 are expected to be between $16 million and $20 million, which is higher than 2020 as a result of the maintenance shutdown. Sustaining capital is expected to be between $16 million and $20 million in each of 2022 and 2023, reflecting the estimated capital cost to increase hazardous waste disposal capacity.

Timok gold project

Based on the positive results of the pre-feasibility study (“PFS”) for the Timok gold project, the Company is now progressing with a feasibility study (“FS”). The cost of the FS is expected to be between $11 million and $13 million in 2021 and has been included in growth capital expenditures.

Loma Larga gold project

On July 26, 2021, DPM completed the acquisition of the remaining portion of INV not already held by DPM, and now owns 100% of INV, which is focused on the development of the Loma Larga gold project located in Ecuador. With positive results from the FS completed by INV prior to the acquisition, the Company is planning to proceed with the permitting process while performing technical reviews to optimize the FS and drilling to further advance the project. The cost is expected to be between $5 million and $7 million over the balance of 2021 and has been included in the revised guidance for growth capital expenditures.

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Exploration and evaluation expenditures

Expenditures related to exploration in 2021 are expected to be between $13 million and $15 million and will be directed toward a 60,000 metre brownfield drilling program on mine concessions and exploration licenses at, or around, the Chelopech and Ada Tepe mines in Bulgaria and a further 30,000 metres of drilling planned on the Timok exploration license in Serbia.

At Chelopech, exploration efforts will concentrate on near mine exploration drilling related to the Sveta Petka commercial discovery process, which includes West Shaft and Wedge targets, and on drilling more conceptual targets on the Brevene exploration license, including Bridge and Vozdol.

At Ada Tepe, a significant portion of the exploration budget is dedicated to near mine target delineation drilling within the mining concession, including Surnak, Synap and Kuklitsa, while additional drilling is expected to commence later in the year on other exploration licenses in the Krumovgrad district.

At Timok, drilling was focused on shallow oxide resource delineation at the Chocolate and Chocolate south targets, proximal to Bigar Hill, as well with target delineation drilling on Čoka Rakita, Frasen and other under explored sulphide targets. Later in the year, drilling will concentrate on target delineation surface work and scout drilling on other Serbia regional licenses.

Evaluation expenditures in 2021 in the range of $2 million to $3 million are primarily related to the estimated costs of the PFS, which was completed in the first quarter of 2021.

COVID-19

To date, with the proactive measures taken by each of the Company’s operations, the COVID-19 pandemic has had minimal impact on DPM’s production. DPM is closely monitoring the COVID-19 situation and has put measures in place to safeguard the health of its workforce and support the continuity of its operations. Given the highly uncertain and evolving nature of this situation, the Company is not able to reliably estimate the likelihood, timing, duration, severity and scope of this pandemic and the potential impact it could have on the Company’s future operating and financial results. As a result, the three-year outlook provided is predicated on the COVID-19 pandemic continuing to be effectively managed with minimal impact on DPM’s operations. For additional details on COVID-19, including the related risks faced by the Company, refer to the “Overview – Operational and Financial Highlights” and “Risk and Uncertainties” sections contained in this MD&A.

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REVIEW OF OPERATING RESULTS BY SEGMENT

Chelopech – Selected Operational and Financial Highlights

$ thousands, unless otherwise indicated Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Operational Highlights Ore mined_(mt) Ore processed(mt) Gold recoveries: Gold-copper concentrate (%) Pyrite concentrate (%) Head grade / recoveries: Gold(g/mt)/ combined recoveries (%) Copper(%)/ % Gold-copper concentrate produced(mt) Pyrite concentrate produced(mt) Metals contained in concentrate produced: Gold in gold-copper concentrate(ounces) Gold in pyrite concentrate(ounces) Total gold production Copper(pounds) Cash cost per tonne of ore processed Cash cost per ounce of gold in gold-copper concentrate produced(1) Cash cost per pound of copper in gold-copper concentrate produced(1) Gold-copper concentrate delivered(mt) Pyrite concentrate delivered(mt) Payable metals in concentrate sold: Gold in gold-copper concentrate(ounces)(2) Gold in pyrite concentrate(ounces)(2) Total payable gold in concentrate sold Copper(pounds)_(2) Cash cost per ounce of gold sold, net of by-product credits All-in sustaining cost per ounce of gold Cost pertonne ofgold-copperconcentrate sold(3)	539,786 558,993 535,576 555,958 52.2 50.8 27.2 24.4 3.85 / 79.43.65 / 75.2 1.02 / 83.10.97 / 78.7 29,503 27,401 74,263 73,532 34,616 33,149 18,022 15,939 52,638 49,088 10,012,9179,378,230 50.09 37.65 432 437 1.07 0.62 29,998 26,947 48,753 46,181 31,990 30,083 7,239 6,640 39,229 36,723 9,468,1888,542,690 482 707 638 926 1,077 1,016	1,081,1851,092,018 1,079,1781,101,788 48.5 49.5 25.6 24.1 3.48 / 74.13.52 / 73.6 0.89 / 81.20.98 / 78.8 51,618 55,265 129,153 138,930 58,551 61,689 30,966 30,030
		89,517 91,719 17,186,54318,759,352 45.83 36.98 481 437 1.12 0.66 55,288 57,071 113,074 112,439 58,140 59,741 16,623 15,747
		74,763 75,488 16,746,81318,063,122 507 656 649 799 1,179 999
Financial Highlights Revenue(4) Cost of sales(5) Earnings before income taxes Adjusted EBITDA Net earnings/Adjusted net earnings Capital expenditures incurred: Growth Sustaining Totalcapitalexpenditures	78,810 59,774 32,313 27,376 44,834 31,843 50,077 39,414 40,587 28,813 818 1,056 5,529 3,333 6,347 4,389	150,515 122,908 65,177 57,017 81,639 64,934 93,025 79,801 73,536 58,565 1,516 2,215 9,123 6,579
		10,639 8,794

• 1) Cash cost per ounce of gold in gold-copper concentrate produced and cash cost per pound of copper in gold-copper concentrate produced are not defined under IFRS. Refer to the “Non-GAAP Financial Measures” section of this MD&A for more information, including reconciliations of these Non-GAAP measures.

• 2) Represents payable metals in gold-copper and pyrite concentrate sold based on provisional invoices.

• 3) Represents cost of sales divided by the volume of gold-copper concentrate delivered.

• 4) Revenue includes the value of payable metals sold, deductions for treatment charges, penalties, transportation and other selling costs, and final settlements to reflect any physical and cost adjustments on provisionally priced sales. Net unfavourable final settlements of $1.6 million (2020 – net favourable final settlements of $2.2 million) and $4.1 million (2020 – net favourable final settlements of $5.4 million) were recognized in the second quarter and first six months of 2021, respectively. Deductions during the second quarter and first six months of 2021 were $28.9 million (2020 – $26.8 million) and $46.7 million (2020 – $53.0 million), respectively.

• 5) Cost of sales includes depreciation of $5.1 million (2020 – $7.4 million) and $11.1 million (2020 – $14.5 million) in the second quarter and first six months of 2021, respectively.

DUNDEE PRECIOUS METALS INC. | 18

Review of Chelopech Results

Concentrate and metals production

Gold-copper concentrate produced during the second quarter of 2021 of 29,503 tonnes was 8% higher than the corresponding period in 2020 due primarily to higher copper grades and recoveries. Gold-copper concentrate produced during the first six months of 2021 of 51,618 tonnes was 7% lower than the corresponding period in 2020 due primarily to lower copper grades, partially offset by higher copper recoveries.

Pyrite concentrate produced during the second quarter of 2021 of 74,263 tonnes was comparable to the corresponding period in 2020. Pyrite concentrate produced during the first six months of 2021 of 129,153 tonnes was 7% lower than the corresponding period in 2020 due primarily to lower gold grades during the first quarter of 2021.

In the second quarter and first six months of 2021, gold contained in gold-copper and pyrite concentrate produced was 52,638 ounces and 89,517 ounces, respectively, compared to 49,088 ounces and 91,719 ounces in the corresponding periods in 2020.

Relative to the second quarter of 2020, gold contained in gold-copper concentrate produced in the second quarter of 2021 increased by 4% to 34,616 ounces and gold contained in pyrite concentrate produced increased by 13% to 18,022 ounces. These increases were due primarily to higher gold grades as a result of mining higher grade zones and improved recoveries, partially offset by lower ore processed. Relative to the first six months of 2020, gold contained in gold-copper concentrate produced in the first six months of 2021 decreased by 5% to 58,551 ounces due primarily to lower ore processed and lower gold recoveries and grades, and gold contained in pyrite concentrate produced increased by 3% to 30,966 ounces due primarily to higher gold recoveries, partially offset by lower ore processed.

Copper production in the second quarter of 2021 of 10.0 million pounds was 7% higher than the corresponding period in 2020 due primarily to higher copper grades and recoveries, partially offset by lower ore processed. Copper production in the first six months of 2021 of 17.2 million pounds was 8% lower than the corresponding period in 2020 due primarily to lower copper grades, partially offset by higher copper recoveries.

Concentrate deliveries and metals sold

Deliveries of gold-copper concentrate in the second quarter of 2021 of 29,998 tonnes were 11% higher than the corresponding period in 2020 due primarily to higher gold production and the timing of gold-copper concentrate shipments. Deliveries of gold-copper concentrate during the first six months of 2021 of 55,288 tonnes were 3% lower than the corresponding period in 2020 due primarily to lower production as a result of lower copper grades, partially offset by higher copper recoveries.

Deliveries of pyrite concentrate in the second quarter of 2021 of 48,753 tonnes were 6% higher than the corresponding period in 2020 due primarily to the timing of deliveries. Deliveries of pyrite concentrate during the first six months of 2021 of 113,074 tonnes was comparable to the corresponding period in 2020.

In the second quarter of 2021, payable gold in gold-copper concentrate sold increased by 6% to 31,990 ounces and payable copper increased by 11% to 9.5 million pounds, respectively, relative to the corresponding period in 2020. The increases in payable metals were due primarily to higher production and the timing of deliveries. Payable gold in pyrite concentrate sold in the second quarter of 2021 of 7,239 ounces was 9% higher than the corresponding period in 2020 consistent with higher production.

In the first six months of 2021, payable gold in gold-copper concentrate sold decreased by 3% to 58,140 ounces and payable copper decreased by 7% to 16.8 million, respectively, relative to the corresponding period in 2020. The decrease in payable gold sold was consistent with lower production. The decrease in payable copper sold was due primarily to lower production as a result of lower copper grades, partially offset by higher copper recoveries. Payable gold in pyrite concentrate sold in the first six months of 2021

DUNDEE PRECIOUS METALS INC. | 19

of 16,623 ounces was 6% higher than the corresponding period in 2020 due primarily to higher gold recoveries, partially offset by lower ore processed.

Inventory

Gold-copper concentrate inventory totaled 1,613 tonnes as at June 30, 2021, down from 5,283 tonnes as at December 31, 2020 due primarily to the timing of deliveries. Pyrite concentrate inventory totaled 27,865 tonnes as at June 30, 2021, up from 11,786 tonnes as at December 31, 2020 due primarily to the timing of deliveries.

Cash cost measures

Cash cost per tonne of ore processed in the second quarter and first six months of 2021 of $50.09 and $45.83, respectively, was 33% and 24% higher than the corresponding periods in 2020 due primarily to the impact of a stronger Euro relative to the U.S. dollar and higher local currency operating expenses related to higher training costs, the timing of maintenance activities, higher electricity rates and higher labour incentives, partially offset by lower volumes of ore processed.

Cash cost per ounce of gold sold, net of by-product credits, in the second quarter and first six months of 2021 of $482 and $507, respectively, was 32% and 23% lower than the corresponding periods in 2020 due primarily to higher by-product credits reflecting higher realized metal prices, partially offset by higher local currency operating expenses as discussed above and a stronger Euro relative to the U.S. dollar.

All-in sustaining cost per ounce of gold in the second quarter and first six months of 2021 was $638 and $649, respectively, compared to $926 and $799 in the corresponding periods in 2020 due primarily to higher by-product credits and lower allocated general and administrative expenses, partially offset by higher local currency operating expenses, higher cash outlays for sustaining capital and a stronger Euro relative to the U.S. dollar.

Net earnings / Adjusted net earnings

Net earnings and adjusted net earnings in the second quarter of 2021 of $40.6 million were $11.8 million higher than the corresponding period in 2020 due primarily to higher realized metal prices and higher metals sold, partially offset by higher local currency operating expenses in respect of training, maintenance, electricity and labour incentives, higher treatment charges including final cost adjustments on provisional concentrate sales, and a stronger Euro relative to the U.S. dollar.

Net earnings and adjusted net earnings in the first six months of 2021 of $73.5 million were $15.0 million higher than the corresponding period in 2020 due primarily to higher realized metal prices, partially offset by higher local currency operating expenses, a stronger Euro relative to the U.S. dollar, higher treatment charges including final cost adjustments on provisional concentrate sales and lower metals sold.

The following table summarizes the key drivers affecting the change in adjusted net earnings:

$ millions	Three	Six
Ended June 30,	Months	Months
Adjusted net earnings - 2020	28.8	58.5
Higher realized metal prices	18.6	35.4
Lower depreciation & amortization	2.3	3.5
Higher operating expenses(1)	(5.4)	(7.9)
Stronger Euro	(1.9)	(4.3)
Income taxes and other	(2.3)	(4.1)
Higher treatment charges, including final settlements	(3.2)	(3.9)
Higher(lower)metals sold	3.7	(3.7)
Adjusted net earnings - 2021	40.6	73.5

1) Excludes impact of depreciation and foreign exchange.

DUNDEE PRECIOUS METALS INC. | 20

Capital expenditures

Capital expenditures during the second quarter and first six months of 2021 of $6.3 million and $10.6 million, respectively, were $1.9 million and $1.8 million higher than the corresponding periods in 2020 and in line with 2021 guidance.

Mineral Reserve and Mineral Resource update

On March 30, 2021, the Company announced that Chelopech successfully added 3.9 million tonnes to Mineral Reserves, which more than offset 2020 production depletion of 2.2 million tonnes for a net addition of 1.7 million tonnes. Relative to the previous Mineral Reserve estimate, this represents an increase of 10% in tonnage and an increase in metal content of 5% for gold, 13% for silver and 3% for copper, extending the life of mine to 2029.

Measured and Indicated Mineral Resources, exclusive of Mineral Reserves, increased 22%, representing a 3.2 million tonnes net increase in tonnage and an increase in metal content of 12% for gold and 6% for copper, further adding to the potential to extend the mine life, if such Mineral Resources are converted to Mineral Reserves.

See the Company’s press release dated March 30, 2021 entitled “Dundee Precious Metals Announces Mine Life Extension and Update to Mineral Resource and Mineral Reserve Estimates for the Chelopech Mine” for additional information, including key assumptions and parameters relating to the foregoing Mineral Resource and Mineral Reserve Estimates.

DUNDEE PRECIOUS METALS INC. | 21

Ada Tepe – Selected Operational and Financial Highlights

Ada Tepe – Selected Operational and Financial	Highlights
$ thousands, unless otherwise indicated Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Operational Highlights Ore mined_(mt) Ore processed(mt) Head grade / recoveries in gold concentrate(1) Gold(g/mt)/% Gold concentrate produced(mt) Metals contained in concentrate produced: Gold(ounces) Cash cost per tonne of ore processed Cash cost per ounce of gold in concentrate produced Gold concentrate delivered(mt) Payable metals in concentrate sold: Gold(ounces)_(2) Cash cost per ounce of gold sold, net of by-product credits All-insustaining cost perounce ofgold	263,893 272,256 207,035 224,539 5.88 / 82.8 5.34 / 83.9 1,818 1,517 32,490 32,277 51.86 44.00 321 301 1,808 1,622 31,201 34,115 363 340 563 517	585,357 464,021 425,689 458,010 5.79 / 82.95.03 / 84.5 3,504 2,989 65,869 62,609 47.45 41.99 297 301 3,531 3,109 64,234 63,604 339 360 507 500
Financial Highlights Revenue(3) Cost of sales(4) Earnings before income taxes Adjusted EBITDA Net earnings/Adjusted net earnings Capital expenditures incurred: Growth Sustaining Totalcapitalexpenditures	55,849 55,993 23,842 25,052 30,586 29,290 43,778 44,051 26,875 26,555 - 180 4,605 5,018 4,605 5,198	113,266 99,022 47,517 47,988 63,929 49,246 91,230 77,051 54,449 44,493 - 233 8,943 6,755
		8,943 6,988

• 1) Recoveries are after the flotation circuit but before filtration.

• 2) Represents payable metals in gold concentrate sold based on provisional invoices.

3) Revenue includes the value of payable metals sold, deductions for treatment charges, penalties, transportation and other selling costs, and final settlements to reflect any physical and cost adjustments on provisionally priced sales.

4) Cost of sales includes depreciation of $13.1 million (2020 – $14.3 million) and $27.1 million (2020 – $26.7 million) in the second quarter and first six months of 2021, respectively.

Review of Ada Tepe Results

Gold production

Gold contained in concentrate produced in the second quarter and first six months of 2021 of 32,490 ounces and 65,869 ounces, respectively, were 1% and 5% higher than the corresponding periods in 2020 due primarily to higher gold grades, partially offset by lower volumes of ore processed.

Gold sold

Payable gold in concentrate sold in the second quarter of 2021 of 31,201 ounces was 9% lower than the corresponding period in 2020 due primarily to lower volumes of ore processed, partially offset by higher gold grades. Payable gold in concentrate sold in the first six months of 2021 of 64,234 ounces was comparable to the corresponding period in 2020 due primarily to higher gold grades and the timing of deliveries, partially offset by lower volumes of ore processed.

Inventory

Gold concentrate inventory totaled 64 tonnes as at June 30, 2021, down from 91 tonnes as at December 31, 2020.

DUNDEE PRECIOUS METALS INC. | 22

Cash cost measures

Cash cost per tonne of ore processed in the second quarter and first six months of 2021 of $51.86 and $47.45, respectively, was 18% and 13% higher than the corresponding periods in 2020 due primarily to higher royalty expense as a result of a higher profit-based royalty rate, higher labour incentives, higher electricity rates, and the impact of a stronger Euro relative to the U.S. dollar, partially offset by lower volumes of ore processed and reduced costs related to grade control drilling as these costs are being capitalized as part of the accelerated life of mine grade control drilling program being carried out in 2021.

Cash cost per ounce of gold sold, net of by-product credits, in the second quarter of 2021 of $363 was $23 higher than the corresponding period in 2020 due primarily to lower gold sold. Cash cost per ounce of gold sold, net of by-product credits, in the first six months of 2021 of $339 was $21 lower than the corresponding period in 2020 due primarily to the sale of lower cost inventory as a result of the timing of deliveries, partially offset by a stronger Euro relative to the U.S. dollar.

All-in sustaining cost per ounce of gold in the second quarter of 2021 was $563 compared to $517 in the corresponding period in 2020 due primarily to higher cash outlays for sustaining capital expenditures and lower gold sold, partially offset by lower allocated general and administrative expenses. All-in sustaining cost per ounce of gold in the first six months of 2021 of $507 was comparable to the corresponding period in 2020 due primarily to higher cash outlays for sustaining capital expenditures and a stronger Euro relative to the U.S. dollar offset by the sale of lower cost inventory as a result of the timing of deliveries and lower allocated general and administrative expenses.

Net earnings / Adjusted net earnings

Net earnings and adjusted net earnings in the second quarter of 2021 was $26.9 million compared to $26.6 million in the corresponding period in 2020 due primarily to higher realized gold prices, partially offset by lower gold in concentrate sold. Net earnings and adjusted net earnings in the first six months of 2021 of $54.4 million were $9.9 million higher than the corresponding period in 2020 due primarily to higher realized gold prices and the sale of lower cost inventory as a result of the timing of deliveries, partially offset by higher income taxes reflecting higher earnings.

The following table summarizes the key drivers affecting the change in adjusted net earnings:

$ millions	Three	Six
Ended June 30,	Months	Months
Adjusted net earnings – 2020	26.6	44.5
Higher realized gold prices	4.5	13.3
Lower operating expenses(1)	0.9	2.6
Higher (lower) gold sold	(4.9)	0.7
Income taxes and other	(0.5)	(4.6)
Stronger Euro	(0.9)	(1.6)
Lower(higher) depreciation	1.2	(0.5)
Adjusted net earnings – 2021	26.9	54.4

1) Excludes impact of depreciation and foreign exchange.

Capital expenditures

Capital expenditures during the second quarter of 2021 of $4.6 million were $0.6 million lower than the corresponding period in 2020 due primarily to the timing of expenditures. Capital expenditures during the first six months of 2021 of $8.9 million were $1.9 million higher than the corresponding period in 2020 due primarily to the planned accelerated life of mine grade control drilling program.

DUNDEE PRECIOUS METALS INC. | 23

Tsumeb – Selected Operational and Financial Highlights

$ thousands, unless otherwise indicated Ended June 30,	Three Months	Six Months
	2021 2020	2021 2020
Operational Highlights Complex concentrate smelted_(mt): Chelopech Third parties Total complex concentrate smelted Cash cost per tonne of complex concentrate smelted, net of by-product credits Acid production(mt) Acid deliveries (mt)_	18,187 22,984 41,440 35,532 59,627 58,516 400 345 66,186 65,595 53,657 72,043	26,310 41,093 56,326 82,433
		82,636 123,526 558 352 88,304 134,341 92,101 143,717
Financial Highlights Toll revenue(1) Acid revenue Total revenue Cost of sales(2) Earnings (loss) before income taxes Adjusted earnings (loss) before interest, taxes, depreciation and amortization Net earnings (loss)/Adjusted net earnings (loss) Capital expenditures incurred: Growth Sustaining Totalcapitalexpenditures	35,898 32,170 4,179 6,091 40,077 38,261 33,786 30,513 6,087 5,319 12,555 10,059 6,087 5,319 (55) 125 1,545 906 1,490 1,031	42,511 67,166 6,474 12,719
		48,985 79,885 62,890 64,860 (14,369) 12,640 (3,308) 22,496 (14,369) 12,640 103 1,659 10,621 1,786
		10,724 3,445

• 1) Includes deductions for stockpile interest and favourable or unfavourable estimated metal recoveries.

• 2) Cost of sales includes depreciation of $5.8 million (2020 – $4.1 million) and $9.7 million (2020 – $8.4 million) in the second quarter and first six months of 2021, respectively.

Review of Tsumeb Results

Production & acid deliveries

Complex concentrate smelted during the second quarter of 2021 of 59,627 tonnes was comparable to the corresponding period in 2020. Complex concentrate smelted during the first six months of 2021 of 82,636 tonnes was 33% lower than the corresponding period in 2020 due primarily to the planned Ausmelt furnace maintenance shutdown, which was completed during the first quarter of 2021. Originally planned for 30 days, the maintenance shutdown was extended to 45 days. This was primarily a result of COVID-19 related safety protocols, travel restrictions and the use of remote commissioning support, as well as an increase in the scope of the maintenance work around the Ausmelt lining replacement and additional converter maintenance.

Acid production in the second quarter of 2021 of 66,186 tonnes was comparable to the corresponding period in 2020. Acid production in first six months of 2021 of 88,304 tonnes was 34% lower than the corresponding period in 2020 in line with concentrate smelted.

Acid deliveries in the second quarter of 2021 of 53,657 tonnes was 26% lower than the corresponding period in 2020 due primarily to the timing of deliveries. Acid deliveries in the first six months of 2021 of 92,101 tonnes was 36% lower than the corresponding period in 2020 due primarily to reduced production.

Cash cost per tonne of complex concentrate smelted, net of by-product credits

Cash cost per tonne of complex concentrate smelted in the second quarter of 2021 of $400 was $55 higher than the corresponding period in 2020 due primarily to a stronger ZAR relative to the U.S. dollar and lower acid by-product credits as a result of the timing of deliveries. Cash cost per tonne of complex concentrate smelted in the first six months of 2021 of $558 was $206 higher than the corresponding period in 2020 reflecting the fixed cost nature of the facility and the impact of lower volumes of complex concentrate

DUNDEE PRECIOUS METALS INC. | 24

smelted resulting from the longer-than anticipated maintenance shutdown, which was completed during the first quarter of 2021, combined with a stronger ZAR relative to the U.S. dollar.

Net earnings (loss) / Adjusted net earnings (loss)

Net earnings and adjusted net earnings in the second quarter of 2021 was $6.1 million compared to $5.3 million in the corresponding period in 2020 due primarily to favourable estimated metal recoveries and lower local currency operating expenses, partially offset by a stronger ZAR relative to the U.S. dollar and lower acid revenue as a result of the timing of deliveries.

Net loss and adjusted net loss in the first six months of 2021 was $14.4 million compared to net earnings and adjusted net earnings of $12.6 million in the corresponding period in 2020 due primarily to lower volumes of complex concentrate smelted as a result of the longer than anticipated furnace maintenance shutdown completed in the first quarter of 2021, lower acid revenue as a result of the timing of deliveries, a stronger ZAR relative to the U.S. dollar, partially offset by lower local currency operating expenses.

The following table summarizes the key drivers affecting the change in adjusted net earnings (loss):

$ millions	Three	Six
Ended June 30,	Months	Months
Adjusted net earnings – 2020	5.3	12.6
Higher (lower) volumes of complex concentrate smelted	0.4	(19.7)
Lower acid deliveries	(2.1)	(6.0)
Stronger ZAR(1)	(2.5)	(2.5)
Higher (lower) estimated metal recoveries	3.3	(1.9)
Lower depreciation and amortization	(1.7)	(1.3)
Lower operating expenses(2)	2.7	3.3
Other	-	0.7
Highertoll rates and acid prices	0.7	0.4
Adjusted net earnings (loss) – 2021	6.1	(14.4)

1) Includes realized gains on foreign exchange option contracts of $2.4 million and $3.6 million in the second quarter and first six months of 2021, respectively, compared to realized losses on foreign exchange option contracts of $2.3 million and $2.4 million in the corresponding periods in 2020.

2) Excludes impact of depreciation and foreign exchange.

Capital expenditures

Capital expenditures during the second quarter of 2021 of $1.5 million were $0.5 million higher than the corresponding period in 2020. Capital expenditures during the first six months of 2021 of $10.7 million were $7.3 million higher than the corresponding period in 2020 due primarily to expenditures related to the planned Ausmelt furnace maintenance shutdown.

DUNDEE PRECIOUS METALS INC. | 25

REVIEW OF CORPORATE & OTHER SEGMENT RESULTS

The Corporate & Other segment results include corporate general and administrative expenses, corporate social responsibility expenses, exploration and evaluation expenses, and other income and expense items that do not pertain directly to an operating segment.

The following table summarizes the Company’s selected Corporate & Other segment results:

$ thousands Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Financial Highlights General and administrative expenses Corporate social responsibility expenses Exploration and evaluation expenses Finance cost Other (income) expense(1) Loss before income taxes Adjusted loss before interest, taxes, depreciation and amortization Net loss attributable to common shareholders Adjustednetloss	2,982 12,179 654 757 2,679 2,759 340 418 (80) (2,622) (6,575) (13,491) (5,778) (15,916) (6,047) (12,640) (6,433) (16,589)	6,847 14,150 1,133 1,480 5,252 5,349 733 939 7,025 558 (20,990) (22,476) (14,150) (21,169) (25,395) (21,950) (15,478) (22,944)

1) Includes net losses on Sabina special warrants of $0.2 million (2020 – net gains of $3.0 million) and $5.6 million (2020 – net gains of $0.1 million) in the second quarter and first six months of 2021, respectively.

General and administrative expenses

General and administrative expenses in the second quarter and first six months of 2021 were $3.0 million and $6.9 million, respectively, compared to $12.2 million and $14.2 million in the corresponding periods in 2020 due primarily to a favourable period over period change related to share-based compensation as a result of changes in DPM’s share price, partially offset by higher professional fees primarily related to digital initiatives.

Exploration and evaluation expenses

Exploration and evaluation expenses in the second quarter and first six months of 2021 of $2.7 million and $5.3 million, respectively, were comparable to the corresponding periods in 2020, which were related primarily to drilling activities on potential targets in priority areas at Timok.

For a more detailed discussion on the Company’s exploration activities, refer to the “Exploration” section contained in this MD&A. For a more detailed discussion on the Timok gold project, refer to the “Development and Other Major Projects” section contained in this MD&A.

REVIEW OF DISCONTINUED OPERATIONS

MineRP Disposition

On December 22, 2020, the Company and other shareholders of MineRP entered into a definitive agreement with Epiroc Canada Holding Inc., a subsidiary of Epiroc Rock Drills AB (“Epiroc”) for the sale of MineRP. The MineRP Disposition closed on May 3, 2021.

The Company received a total cash consideration of $45.8 million for the repayment of DPM shareholder loans and disposition of its equity interest in MineRP, resulting in a gain on MineRP Disposition of $20.7 million in net earnings from discontinued operations in the second quarter and first six months of 2021. Net cash consideration received includes $5.1 million held in escrow on closing to secure against any post closing adjustments related to working capital and certain representations and warranties for a period up to 2 years. This $5.1 million was recognized as restricted cash in the condensed interim consolidated

DUNDEE PRECIOUS METALS INC. | 26

statements of financial position as at June 30, 2021, of which $1.6 million relating to working capital items was included in other current assets and $3.5 million relating to other indemnities was included in other long-term assets. The MineRP Disposition also provides for potential additional proceeds in the form of an earn-out conditional on the achievement of certain revenue targets by MineRP in 2021 and 2022, for which no value has been recognized as at June 30, 2021.

Financial highlights

Revenue in the second quarter and first six months of 2021 of $0.6 million and $4.5 million, respectively, compared to $3.0 million and $6.9 million the corresponding periods in 2020.

Net earnings from discontinued operations attributable to common shareholders in the second quarter and first six months of 2021 was $20.7 million and $20.0 million, respectively, compared to net earnings of $0.8 million and a net loss of $1.7 million in the corresponding periods in 2020 driven primarily by the gain on MineRP Disposition of $20.7 million.

LIQUIDITY AND CAPITAL RESOURCES

As at June 30, 2021, the Company had cash of $260.5 million, investments valued at $76.9 million primarily related to its 8.9% interest in Sabina and 23.5% interest in INV, and $150.0 million of undrawn capacity under its RCF.

The Company’s liquidity is impacted by several factors which include, but are not limited to, gold, copper and acid market prices, production levels, capital expenditures, operating cash costs, interest rates and foreign exchange rates. These factors are monitored by the Company on a regular basis.

As at June 30, 2021, the Company’s cash resources and available capital under its RCF continue to provide sufficient liquidity and capital resources to meet its current operating and capital expenditure requirements, all contractual commitments, as well as a number of margin improvement and growth opportunities. The Company may, from time to time, raise additional capital to ensure it maintains its financial strength and has sufficient liquidity to support its discretionary growth capital projects and the overall needs of the business.

As part of the Company’s assessment of the potential implications associated with the COVID-19 pandemic, the Company assessed its financial resources as at June 30, 2021 and concluded that it has sufficient available cash resources to manage the potential impacts that could reasonably be expected to arise.

Capital Allocation – INV Acquisition and Declaration of Dividend

As part of its strategy, the Company adheres to a disciplined capital allocation framework that is based on three fundamental considerations – balance sheet strength, reinvestment in the business, and the return of capital to shareholders. Maintaining a strong balance sheet includes ensuring adequate liquidity, managing within prudent financial metrics, and building a strong cash position to support accretive growth. Reinvestment in the business includes investing in its operating assets to sustain and optimize performance; investing in resource development to extend the life of its mines and to identify new gold resources; further advancing existing resources towards production; as well as investing in new projects to grow beyond its existing asset base. Returning capital to shareholders includes dividends, and under certain circumstances, opportunistic share repurchases. These alternatives are not mutually exclusive and are assessed in a balanced manner with a view to maximizing total shareholder returns over the long-term.

On July 26, 2021, the Company acquired all of the issued and outstanding shares it did not already own of INV, the principal assets of which are comprised of the Loma Larga gold project and certain other exploration licenses. This transaction was accounted for as an asset acquisition and the total consideration for the acquisition consists of: i) 0.0910 DPM common shares for each INV common share acquired for a total of 10,664,501 DPM common shares at a market price of $5.72 (Cdn$7.19) per share with an aggregate value of $61.0 million; ii) 1,119,728 DPM stock options with a fair market value of $2.4 million in exchange for 12,304,700 outstanding INV stock options which vested immediately as at the date of acquisition; and iii) transaction costs of $2.5 million. The total consideration was allocated primarily to the exploration and

DUNDEE PRECIOUS METALS INC. | 27

evaluation assets related to the Loma Larga gold project. This acquisition leverages DPM’s proven strengths in developing world-class assets and applying industry-leading ESG solutions to unlock the significant potential of the Loma Larga gold project.

On February 11, 2021 and May 5, 2021, the Company declared a quarterly dividend of $0.03 (2020 – $0.02) per common share to shareholders of record on March 31, 2021 and June 30, 2021, respectively, resulting in total dividend distributions of $10.9 million (2020 – $7.2 million) recognized against its retained earnings in the condensed interim consolidated statements of changes in shareholders’ equity for the six months ended June 30, 2021. The Company paid an aggregate of $10.9 million (2020 – $3.6 million) of dividends which were included in cash used in financing activities in the condensed interim consolidated statements of cash flows for the six months ended June 30, 2021 and recognized a dividend payable of $5.5 million (December 31, 2020 – $5.4 million) in accounts payable and accrued liabilities in the condensed interim consolidated statements of financial position as at June 30, 2021.

On July 29, 2021, the Company declared a dividend of $0.03 per common share payable on October 15, 2021 to shareholders of record on September 30, 2021.

The Company’s dividend has been set at a level that is considered to be sustainable based on the Company’s free cash flow outlook and is expected to allow the Company to build additional balance sheet strength to support further growth, a key element of DPM’s strategy. The declaration, amount and timing of any future dividend are at the sole discretion of the Board of Directors and will be assessed based on the Company’s capital allocation framework, having regard for the Company’s financial position, overall market conditions, and its outlook for sustainable free cash flow, capital requirements, and other factors considered relevant by the Board of Directors.

Cash Flow

The following table summarizes the Company’s cash flow activities:

$ thousands Ended June 30,	Three Months Six Months
	2021 2020 2021 2020
Cash provided from operating activities, before changes in working capital Changesin working capital	84,673 67,327 147,541 125,544 (8,976) 6,268 (24,253) (40,954)
Cash provided from operating activities Cash provided from (used in) investing activities Cashusedin financing activities	75,697 73,595 123,288 84,590 16,065 (6,914) 914 (15,075) (7,013) (5,261) (13,279) (16,191)
Increase in cash Cash at beginning of period	84,749 61,420 110,923 53,324 175,706 13,187 149,532 21,283
Cashat end ofperiod	260,455 74,607 260,455 74,607

The primary factors impacting period over period cash flow movements are summarized below.

Operating activities

Cash provided from operating activities in the second quarter of 2021 of $75.7 million was $2.1 million higher than the corresponding period in 2020 due primarily to the fulfillment of the prepaid forward gold sales agreement at Ada Tepe in December 2020 and higher realized gold and copper prices, partially offset by an unfavourable period over period change related to working capital. Cash provided from operating activities in the first six months of 2021 of $123.3 million was $38.7 million higher than the corresponding period in 2020 due primarily to a favourable period over period change related to working capital, the fulfillment of the prepaid forward gold sales agreement at Ada Tepe in December 2020 and higher realized gold and copper prices, partially offset by lower volumes of complex concentrate smelted as a result of the planned Ausmelt furnace maintenance shutdown at Tsumeb in 2021.

The unfavourable change in working capital in the second quarter of 2021 of $9.0 million was due primarily to a decrease in other liabilities related to share-based compensation as a result of the decrease in DPM’s share price and an increase in inventories, partially offset by a decrease in accounts receivable as a result

DUNDEE PRECIOUS METALS INC. | 28

of the timing of customer receipts. The unfavourable change in working capital in the first six months of 2021 of $24.3 million was due primarily to an increase in accounts receivable as a result of the timing of customer receipts and higher metal prices and a decrease in other liabilities related to share-based compensation as a result of the decrease in DPM’s share price, partially offset by a decrease in accounts payable and accrued liabilities as a result of the timing of payments to suppliers.

The favourable change in non-cash working capital in the second quarter of 2020 of $6.3 million was due primarily to an increase in other liabilities as a result of increased share-based compensation and an increase in accounts payable and accrued liabilities as a result of the timing of payments to suppliers. The unfavourable change in non-cash working capital in the first six months of 2020 of $40.9 million was due primarily to the timing of customer receipts and higher gold prices and deliveries.

During the second quarter and first six months of 2020, Ada Tepe delivered 6,992 ounces and 20,102 ounces of gold, respectively, pursuant to the prepaid forward gold sales arrangement which resulted in $9.6 million and $27.5 million of deferred revenue being recognized in revenue during the second quarter and first six months of 2020, respectively, with no corresponding impact on cash as these deliveries were in partial satisfaction of the $50.0 million of upfront proceeds received in 2016. In December 2020, the Company completed its final delivery of gold under this arrangement.

Cash provided from operating activities, before changes in working capital, during the second quarter and first six months of 2021 was $84.6 million and $147.5 million, respectively, compared to $67.3 million and $125.5 million in the corresponding periods in 2020. These increases were due primarily to the fulfillment of the prepaid forward gold sales agreement in December 2020 and higher realized gold and copper prices. The first six months of 2021 was also impacted by lower volumes of complex concentrate smelted as a result of the planned Ausmelt furnace maintenance shutdown at Tsumeb.

Investing activities

Cash provided from investing activities in the second quarter and first six months of 2021 was $16.1 million and $0.9 million, respectively, compared to cash used in investing activities of $6.9 million and $15.1 million in the corresponding periods in 2020.

The following table provides a summary of the Company’s cash outlays for capital expenditures:

$ thousands Ended June 30,	Three Months Six Months
	2021 2020 2021 2020
Chelopech Tsumeb Ada Tepe Corporate & Other	5,228 3,805 8,040 6,519 7,248 761 12,618 2,642 4,854 1,653 7,390 4,247 2,931 817 3,434 1,789
Totalcashcapitalexpenditures	20,261 7,036 31,482 15,197

Cash outlays for capital expenditures in the second quarter and first six months of 2021 of $20.3 million and $31.5 million, respectively, were $13.3 million and $16.3 million higher than the corresponding periods in 2020. The period over period increase was due primarily to the planned Ausmelt furnace maintenance shutdown at Tsumeb completed in the first quarter of 2021 and the planned accelerated life of mine grade control drilling program at Ada Tepe.

In the second quarter and the first six months of 2021, the Company received total cash proceeds of $45.8 million from the MineRP Disposition for DPM’s equity interest in MineRP and the repayment of DPM shareholder loans.

During the first six months of 2021, the Company increased its equity interest in INV from 19.4% to 23.5% for an additional cost of $3.1 million. On July 26, 2021, the Company acquired all of the issued and outstanding shares of INV not already owned by DPM.

DUNDEE PRECIOUS METALS INC. | 29

Financing activities

Cash used in financing activities in the second quarter and first six months of 2021 was $7.0 million and $13.3 million, respectively, compared to $5.3 million and $16.2 million in the corresponding periods in 2020.

The primary factors impacting the movement in financing activities are summarized below:

• Net repayments under the RCF in the second quarter and first six months of 2021 were $nil, in each case, compared to $nil and $10.0 million in the corresponding periods in 2020; and

• Dividends paid in the second quarter and first six months of 2021 were $5.5 million and $10.9 million, respectively, compared to $3.6 million in the corresponding periods in 2020.

Financial Position

$ thousands	June	December	Increase/
As at	30, 2021	31,2020	(Decrease)
Cash	260,455	149,532	110,923
Accounts receivable, inventories and other current assets	155,005	138,787	16,218
Assets held for sale	-	30,713	(30,713)
Investments at fair value	76,911	106,595	(29,684)
Non-current assets, excluding investments at fair value	538,175	549,233	(11,058)
Total assets	1,030,546	974,860	55,686
Current liabilities	84,174	79,073	5,101
Liabilities held for sale	-	6,003	(6,003)
Non-current liabilities	79,646	84,500	(4,854)
Equity attributable to common shareholders	866,631	798,669	67,962
Non-controllinginterests	95	6,615	(6,520)

Cash increased by $111.0 million to $260.5 million during the first six months of 2021 due primarily to higher metal prices and continued strong operating performance at Chelopech and Ada Tepe, partially offset by lower volumes of complex concentrate smelted at Tsumeb. Accounts receivable, inventories and other current assets increased by $16.2 million to $155.0 million due primarily to an increase in accounts receivable as a result of the timing of customer receipts and higher metal prices. Investments at fair value decreased by $29.7 million to $76.9 million due primarily to the decrease in Sabina’s share price. Noncurrent assets, excluding investments at fair value, decreased by $11.0 million to $538.2 million due primarily to depreciation and depletion, partially offset by capital expenditures.

Current liabilities increased by $5.1 million to $84.2 million during the first six months of 2021 due primarily to an increase in accounts payable and accrued liabilities as a result of the timing of payments to suppliers and an increase in income tax liabilities. Non-current liabilities decreased by $4.9 million to $79.6 million due primarily to a decrease in share-based compensation as a result of the decrease in DPM’s share price, partially offset by an increase in rehabilitation provisions primarily as a result of a weaker U.S. dollar relative to the ZAR and Euro. Equity attributable to common shareholders increased by $67.9 million to $866.6 million due primarily to net earnings generated in the period and the gain on MineRP Disposition, partially offset by a decrease in accumulated other comprehensive income related to unrealized losses on publicly traded securities and commodity swap contracts, combined with dividends declared.

Contractual Obligations, Commitments and Other Contingencies

The Company had the following minimum contractual obligations and commitments as at June 30, 2021:

$ thousands	**up to 1year **	1 –5 years over 5 years	1 –5 years over 5 years	Total
Lease obligations	5,062	12,030	1,912	19,004
Capital commitments	9,350	-	-	9,350
Purchase commitments	19,868	16,862	-	36,730
Otherobligations	503	520	60	1,083
Totalcontractualobligations and commitments	34,783	29,412	1,972	66,167

DUNDEE PRECIOUS METALS INC. | 30

As at June 30, 2021, Tsumeb had approximately $97.7 million (December 31, 2020 – $76.9 million) of recoverable third party in-process secondary materials, which it is obligated to process and return, generally in the form of blister, to IXM S.A. (“IXM”) pursuant to a tolling agreement (the “Tolling Agreement”). As at June 30, 2021, the value of excess secondary materials, as defined in the Tolling Agreement, was approximately $62.4 million (December 31, 2020 – $45.4 million).

In April 2021, the Company and IXM agreed to amend the existing Tolling Agreement to provide for, among other things: i) targeted declining excess secondary material balances, above which excess secondary material would be required to be purchased by the Company; ii) the elimination of all excess secondary material by March 31, 2023; iii) an increase in the defined level of normal secondary material; and iv) an extension of the Tolling Agreement by three years to December 31, 2026. As at June 30, 2021, the volume of excess secondary materials was below targeted levels.

Debt

As at June 30, 2021 and December 31, 2020, the Company’s total outstanding debt was $nil and the Company was in compliance with all of its debt covenants.

DPM RCF

DPM has a committed RCF of $150.0 million with a consortium of banks. In February 2021, the Company extended the RCF’s maturity date from February 2023 to February 2024. The Company’s borrowing spread above LIBOR is 2.5%, and can range between 2.5% and 3.5% depending upon the Company’s funded net debt to adjusted EBITDA (“Debt Leverage Ratio”), as defined in the RCF agreement. The RCF is secured by pledges of the Company’s investments in Ada Tepe, Chelopech and Tsumeb and by guarantees from each of these subsidiaries.

The RCF contains financial covenants that require DPM to maintain: (i) a Debt Leverage Ratio below 3.75:1, (ii) a current ratio (including the addition of any unutilized credit within tranche B to current assets) of greater than 1.5:1, and (iii) a minimum net worth of $500.0 million plus (minus) 50% of ongoing annual net earnings (loss).

As at June 30, 2021 and December 31, 2020, $nil was drawn under the RCF.

Tsumeb Overdraft Facility

Tsumeb has a Namibian $100.0 million ($7.0 million) demand overdraft facility. This facility is guaranteed by DPM and bears interest at a rate equal to the Namibian Prime Lending Rate minus 0.5%. As at June 30, 2021 and December 31, 2020, $nil was drawn from this facility.

Credit Agreements and Guarantees

In February 2021, Chelopech and Ada Tepe increased its multi-purpose credit facility from $16.0 million to $21.0 million. This credit facility matures on November 30, 2022 and is guaranteed by DPM. As at June 30, 2021, $10.7 million (December 31, 2020 – $6.1 million) had been utilized in the form of letters of credit and letters of guarantee, primarily in respect of concession contracts with the Bulgarian Ministry of Energy.

Chelopech and Ada Tepe also have a Euro 21.0 million ($24.9 million) credit facility to support mine closure and rehabilitation obligations. This credit facility matures on November 30, 2022 and is guaranteed by DPM. As at June 30, 2021, $24.9 million (December 31, 2020 – $25.8 million) had been utilized against this credit facility in the form of letters of guarantee, which were posted with the Bulgarian Ministry of Energy.

In February 2021, Ada Tepe increased its multi-purpose credit facility from $5.3 million to $10.3 million. This credit facility matures on November 30, 2022 and is guaranteed by DPM. As at June 30, 2021, $4.1 million (December 31, 2020 – $0.2 million) had been utilized against this multi-purpose revolving facility in the form of letters of credit and letters of guarantee.

DUNDEE PRECIOUS METALS INC. | 31

Advances under these facilities bear interest at a rate equal to the one month U.S. Dollar LIBOR plus 2.5%. The letters of credit and guarantee bear a fee of 0.6% based on the amounts issued.

Outstanding Share Data

DPM’s common shares are traded on the TSX under the symbol DPM. As at July 29, 2021, 192,694,870 common shares were issued and outstanding.

DPM also has 3,846,610 stock options outstanding as at July 29, 2021 with exercise prices ranging from Cdn$2.69 to Cdn$10.99 per share (weighted average exercise price – Cdn$5.12 per share).

Normal Course Issuer Bid

Effective March 2, 2021, DPM renewed its normal course issuer bid (the “Bid”) to repurchase certain of its common shares (“Shares”) through the facility of the TSX. The number of Shares that can be purchased during the period of the Bid will not exceed 9,000,000 Shares, being approximately 5% of the outstanding Shares as of February 23, 2021. Pursuant to the terms of the Bid, the Company will not acquire on any given trading day more than 182,760 Shares, representing 25% of the average daily volume of Shares for the six months ended January 31, 2021. The price that the Company will pay for Shares in open market transactions will be the market price at the time of purchase and any Shares that are purchased under the Bid will be cancelled. The actual timing and number of Shares that may be purchased pursuant to the Bid will be subject to DPM’s ongoing capital requirements and management’s view that, from time to time, DPM’s Shares may trade at prices well below the underlying value of the Company and during these periods the repurchase of Shares represents an excellent opportunity to enhance shareholder value. No purchases of Shares have been made under the Bid as at the date of this MD&A. The Bid will expire on February 28, 2022.

A copy of the TSX Form 12 for the Bid can be obtained, without charge, by contacting the Company at info@dundeeprecious.com.

Other

The Company is involved in legal proceedings, from time to time, arising in the ordinary course of its business. It is not expected that any material liability will arise from current legal proceedings or have a material adverse effect on the Company’s future business, operations or financial condition.

FINANCIAL INSTRUMENTS

Investments at Fair Value

As at June 30, 2021, the Company’s investments at fair value were $76.9 million (December 31, 2020 - $106.6 million), the vast majority of which related to the value of its investment in Sabina common shares and special warrants and its investment in INV’s common shares.

During the three and six months ended June 30, 2021, the Company purchased an additional 512,820 common shares of Sabina at an average price of $1.56 (Cdn$1.95) per share for a total cost of $0.8 million. As at June 30, 2021, DPM held: (i) 31,050,566 common shares of Sabina and (ii) 5,000,000 Series B special warrants, which will be automatically exercised upon a positive production decision with respect to the Back River project or upon the occurrence of certain other events. Each of the special warrants is exercisable into one common share until 2044.

The fair value of the Sabina special warrants was based on the fair value of the Sabina common shares, which was determined based on the closing bid prices as at June 30, 2021. For the three and six months ended June 30, 2021, the Company recognized unrealized losses on the Sabina special warrants of $0.2 million (2020 – unrealized gains of $3.0 million) and $5.6 million (2020 – unrealized gains of $0.1 million), respectively, in other (income) expense in the condensed interim consolidated statements of earnings (loss).

DUNDEE PRECIOUS METALS INC. | 32

During the six months ended June 30, 2021, the Company increased its equity interest in INV from 19.4% to 23.5% for an additional cost of $3.1 million. On July 26, 2021, the Company acquired all of the issued and outstanding shares it did not already own of INV.

For the three and six months ended June 30, 2021, the Company recognized unrealized gains on publicly traded securities of $4.6 million (2020 – $29.8 million) and unrealized losses of $32.4 million (2020 – unrealized gains of $5.2 million), respectively, in other comprehensive income (loss) that will not be reclassified subsequently to profit or loss.

Commodity Swap Contracts

The Company enters into cash settled commodity swap contracts from time to time to swap future contracted monthly average metal prices for fixed metal prices to eliminate or substantially reduce the metal price exposure associated with the time lag between the provisional and final determination of concentrate sales (“QP Hedges”).

As at June 30, 2021, the Company’s outstanding QP Hedges, all of which mature within six months from the reporting date, are summarized in the table below:

		Weighted average fixed price
Commodity hedged	Volume hedged	of QP Hedges
Payable gold	21,825 ounces	$1,822.10/ounce
Payable copper	9,534,982pounds	$4.27/pound

The Company also enters into cash settled commodity swap contracts from time to time to swap future contracted monthly average prices for fixed metal prices to reduce its future metal price exposure in respect of its projected production (“Production Hedges”).

As at June 30, 2021, the Company had outstanding commodity swap contracts in place in respect of its projected copper production as summarized in the table below:

Year of projected	Volume of copper hedged	Average fixed price
production	(pounds)	($/pound)
Balance of 2021	17,497,167	3.77

As at June 30, 2021, substantially all of the Company’s projected payable copper to be sold over the balance of 2021 has been hedged.

The Company designates the spot component of commodity swap contracts in respect of Production Hedges as cash flow hedges and the spot component of commodity swap contracts in respect of QP Hedges as fair value hedges.

The fair value gain or loss on commodity swap contracts is calculated based on the corresponding LME forward copper prices and New York Commodity Exchange forward gold prices, as applicable. As at June 30, 2021, the net fair value loss on all outstanding commodity swap contracts was $7.0 million (December 31, 2020 – $5.7 million), of which $1.2 million (December 31, 2020 – $0.1 million) was included in other current assets and $8.2 million (December 31, 2020 – $5.8 million) in accounts payable and accrued liabilities.

The Company recognized net losses of $8.6 million (2020 – $3.1 million) and $7.2 million (2020 – $4.1 million), respectively, for the three and six months ended June 30, 2021 in revenue on these commodity swap contracts.

For the three and six months ended June 30, 2021, the Company recognized unrealized losses of $1.2 million (2020 – $nil) and $7.9 million (2020 – $nil), respectively, in other comprehensive income (loss) on the spot component of the outstanding commodity swap contracts in respect of Production Hedges. The Company also recognized unrealized losses of $0.1 million (2020 – $nil) and $0.5 million (2020 – $nil), respectively, on the forward point component of the outstanding commodity swap contracts in respect of

DUNDEE PRECIOUS METALS INC. | 33

Production Hedges in other comprehensive income (loss) as a deferred cost of hedging for the three and six months ended June 30, 2021.

Foreign Exchange Option Contracts

The Company enters into foreign exchange option contracts from time to time to reduce the foreign exchange exposure associated with projected operating expenses and capital expenditures denominated in foreign currencies.

Foreign exchange option contracts are entered to provide price protection below a specified “floor” rate and participation up to a specified “ceiling” rate. The option contracts entered are comprised of a series of call options and put options (which when combined create a price “collar”) that are structured so as to provide for a zero upfront cash cost.

As at June 30, 2021, the Company had outstanding foreign exchange option contracts in respect of a portion of its projected Namibian dollar denominated operating expenses, which is linked to the ZAR, as summarized in the table below:

Year of projected		Call options sold	Put options purchased
operating	Amount hedged	weighted average	weighted average
expenses	in ZAR	ceiling rate US$/ZAR	floor rate US$/ZAR
Balance of 2021	649,790,000	18.69	15.65

Approximately 79% of the Company’s projected Namibian dollar operating expenses for the balance of 2021 have been hedged.

The Company designates the intrinsic value of foreign exchange option contracts as cash flow hedges. The time value component of foreign exchange option contracts is treated as a separate cost of hedging.

The fair value gain or loss on these outstanding contracts was calculated based on foreign exchange forward rates quoted in the market. As at June 30, 2021, the net fair value gain on all outstanding foreign exchange option contracts was $4.3 million (December 31, 2020 – $6.4 million), which was included in other current assets.

For the three and six months ended June 30, 2021, the Company recognized unrealized gains of $1.6 million (2020 – unrealized losses of $0.8 million) and unrealized losses of $0.2 million (2020 – $5.2 million), respectively, in other comprehensive income (loss) on the spot component of the outstanding foreign exchange option contracts. The Company also recognized realized gains of $2.4 million (2020 – realized losses of $2.3 million) and $3.6 million (2020 – realized losses of $2.4 million), respectively, for the three and six months ended June 30, 2021 in cost of sales on the spot component of settled contracts.

For the three and six months ended June 30, 2021, the Company recognized unrealized losses of $1.8 million (2020 – unrealized gains of $6.4 million) and $1.8 million (2020 – $5.4 million), respectively, on the time value component of the outstanding foreign exchange option contracts in other comprehensive income (loss) as a deferred cost of hedging.

The Company is also exposed to credit and liquidity risks in the event of non-performance by counterparties in connection with its commodity swap contracts, and foreign exchange option contracts. These risks, which are monitored on a regular basis, are mitigated, in part, by entering into transactions with financially sound counterparties and, where possible, ensuring contracts are governed by legally enforceable master agreements.

DUNDEE PRECIOUS METALS INC. | 34

EXPLORATION

Chelopech Mine

In the second quarter of 2021, a total of 10,703 metres of resource development diamond drilling was completed, which comprised of:

• 3,604 metres of grade control drilling aimed to better define the shape and volume of existing ore bodies; and

• 7,099 metres of extensional drilling designed to explore for new mineralization along modeled trends.

Resource development diamond drilling was concentrated on the upper levels around Block 700 and Block 8. Also, extensional holes were drilled toward the Target North located in the northwestern part of the deposit and Block 148. As a result of grade control drilling, there has been a significant extension in Blocks 17, 19, 146 and 8. A detailed review of the drilling program results is discussed below.

Central Area

Block 17

Grade control drilling from positions 16-270-RA and 17-390-RA were designed to infill and to extend mineralization discovered during earlier work. Drilling in Block 17 returned several positive intersections during the second quarter of 2021. As a result, a new extension of Pyrite-Tennantite-Chalcopyrite mineralization was added between levels 390 mRL and 240 mRL.

Block 19

In the second quarter of 2021, grade control drilling commenced in Block 19. Several of the drill holes returned new mineralization in the western part of the block and extended the contours of the ore body.

Blocks 700 and 8

А total of 1,391 metres was drilled during the second quarter of 2021 from two separate underground drill locations to test the area between Blocks 8, 18 and 700 for additional mineralization. Drilling was also designed to define the final shape and size of Block 700 and to explore the southwestern part of Block 8.

Drill hole EXT700_505_14 (shown in the table below) returned positive results in the upper levels of Block 18. The remaining holes failed to intersect significant mineralization.

Furthermore, the Block 8 grade control drilling program from the same position was conducted during the second quarter of 2021. The mineralization was comprised mainly of disseminated sulphides PyriteTennantite-Chalcopyrite-Chalcocite and individual Barite-Pyrite-Tennantite veins. The results increased the boundaries of the high-grade domain contours between 560 mRL and 420 mRL.

Target North

Target North is located in the northerly section of the Chelopech deposit and hosts narrow, structurallycontrolled high-sulfidation type mineral assemblages. During the second quarter of 2021, drilling continued from position 149S-210-EXP towards Target “North NNW of 147” as part of the Target North exploration program.

In total 3,284 metres were completed during the second quarter aiming to explore for new mineralization in an area to the northwest of Blocks 146, 147 and towards Block 148. These extensional holes confirmed that this area is peripheral and demonstrating relatively lower-temperature hydrothermal alteration. The alteration style transitions from argillic to sericitic and propylitic style, entering the hematitic at the end of the holes. Sporadic mineralization was observed hosted within advanced argillic zones, comprised of

DUNDEE PRECIOUS METALS INC. | 35

individual veins of Pyrite-Tennantite-Barite mineralization and disseminated Pyrite-Tennantite. To date, the results of extensional drill holes have returned narrow, low-continuity mineralization that is below the reporting criteria. Drilling from this position is scheduled to continue in the third quarter of 2021.

Western Area

Block 148

Drilling at three holes from location 149S-210-EXP were completed, aiming to explore the lowest part of Block 148. Drill hole EXT148_210_02 extended significantly the modelled extents of advanced argillic alteration envelope that surrounds Block 148 to level 40 mRL. The assay results are pending.

Furthermore, a drilling program which started in the fourth quarter of 2020 from position 151-135-SP was completed during the second quarter of 2021. The extensional drill holes were directed towards Block 148, as well as toward gaps in drilling between Blocks 148 and 151, aiming to outline new mineralization at depth (between levels 130 mRL and 50 mRL). Drilling during the second quarter of 2021 extended prospective advanced argillic alteration, but assays returned weak grade values. The reporting criteria has been outlined below. In total one hole, EXT151_135_09, returned a significant intersection in Block 144 (presented in table below).

Mineralized intercepts (gold equivalent (“AuEq”) cut-off grade of 3 g/t) received during the second quarter of 2021:

HOLE ID	EAST	NORTH	RL	AZ	DIP	FROM	TO	True Width (m)	AuEq (g/t)	Au (g/t)	Ag (g/t)	Cu (%)
EXT151_135_09	5522	29381	503	9.5	-5.9	402.0	417.0	15.0	3.68	2.43	3.80	0.61
EXT700_505_14	6411	29629	502	301.0	-9.3	241.5	255.0	13.5	15.60	6.19	24.27	4.57

• 1) Mineralized intercepts are located within the Chelopech Mine Concession and proximal to the mine workings.

• 2) AuEq calculation is based on the following formula: Au g/t + 2.06 x Cu %.

• 3) Minimum downhole width reported is 10 metres with a maximum internal dilution of 4.5 metres.

• 4) All holes are drilled with NQ diamond core.

• 5) Coordinates are in mine-grid.

• 6) No factors of material effect have hindered the accuracy and reliability of the data presented above.

• 7) No upper cuts applied.

Outlook

In the third quarter of 2021, the Mineral Resource development strategy for Chelopech will be focused on:

• Additional drilling of the area around Blocks 700 and 8 to extend known mineralization;

• Continued resource development drilling towards Target North – in the areas North and North-West of Block 147, as well as Block 19; and

• In terms of production requirements, grade control drilling program in Blocks 149, 153 and 19 is scheduled to be completed.

Sampling, Analysis, Quality Assurance and Quality Control (“QAQC”) and Data Verification of Chelopech Mine Drill Core

All drill cores are sampled in intervals up to a maximum of three metres, with 1.5 metres sample intervals being the common length within mineralized zones. The dimensions of the mineralized zones far exceed the standard sample length. All holes are drilled with NQ diamond core. NQ core is cut by diamond saw, where one half of the core sample is submitted for assaying and the remaining half is retained in steel core trays. All drill cores are photographed prior to cutting and/or sampling.

Following DPM exploration standard procedures and internationally accredited standards, a full suite of certified reference materials, blanks and field duplicates are submitted to the laboratory with each batch of samples. The overall quality control sample insertion rate is approximately 5% for reference materials, 2% for blanks, and 5% for field duplicates.

DUNDEE PRECIOUS METALS INC. | 36

Sample tickets are entered into the bags with a numbering system, which reconciles sample and assayed results in the acQuire database. The average core recovery within the modeled Mineral Resource constraints is 99.6% and the various phases of drill data show no issues with regards to recoveries. No relationship was evident between core recoveries and the copper assay data, or the gold assay data. The weight of a core sample varies between three and seven kilograms.

Diamond drill core is prepared and assayed at the laboratory managed by SGC Minerals (“SGC”) at Chelopech in Bulgaria, which is independent of the Company. Samples are routinely assayed for copper, gold, silver, sulphur and arsenic.

The Company’s QP has verified that all results reported in this disclosure have passed QAQC protocols. Further verification of results included comparison of assay data with geology, alteration and mineralization logging data.

Chelopech Brownfield Exploration

During the second quarter of 2021, a total of 10,336 metres were drilled as part of the brownfield exploration program focused on drill testing of conceptual targets within the Brevene exploration license (Bridge, Tsarkvishte/Kazana and Aramu South) as well as a proof of concept drilling campaign at the Vozdol prospect.

Additional drilling activities commenced at the Sharlo Dere prospect within the mine concession, aiming to re-evaluate the high-sulphidation style copper-gold mineralization defined historically and integrating additional targeting concepts.

Drill testing commenced also at the Petrovden prospect, a large area characterized by low grade porphyry style mineralization in the immediate footwall of the Petrovden fault, aiming to define the core of the system as well as potentially structurally and lithological controlled higher grade mineralization.

At the Sveta Petka exploration license, following completion of drilling activities at West Shaft and Wedge a rigorous drill core and data review commenced to support an updated geologic model. This review will also incorporate new observations and concepts that relate to the occurrence of higher grade mineralization and will be used to optimize infill and mineral resource delineation drilling planned at Sveta Petka. The one year exploration license extension is expected to be granted in late 2021 which will allow progression of the registered Geological Discovery towards initiation of Commercial Discovery process.

Ada Tepe Grade Control Drilling

In the second quarter of 2021, reverse circulation drilling was conducted in pushbacks two, three and four of the pit as part of a plan to complete all grade control drilling within the life of mine pit volume during 2021. During the second quarter, 53,383 metres were completed with four active rigs. In the third quarter of 2021, 50,000 metres of grade control drilling are planned, designed to infill volumes that are scheduled to be mined later in the mine life.

Ada Tepe Brownfield Exploration

During the second quarter of 2021, drilling activities were completed at Surnak, Synap and Kuklitsa prospects, in the Khan Krum mining concession, with a total of 4,197 metres drilled.

At Surnak, a total of 634 metres were completed during the second quarter of 2021 and all results have been received (see below table). The program successfully tested the extensions of the hydrothermal system along strike and dip of the mineralized structures as inferred from the new conceptual geological model. Internal evaluation of the Surnak prospect is ongoing.

DUNDEE PRECIOUS METALS INC. | 37

Significant drill intercepts from the Surnak prospect received during the second quarter of 2021:

						FROM	TO	LENGTH	Au	Ag
HOLE ID	EAST	NORTH	RL	AZ	DIP
						(m)	(m)	(m)	(g/t)	(g/t)
SUDD080	384310	4587364	458	272	-30	31	36	5	0.62	3.26
SUDD081	384355	4587659	444	237	-49	66	72	6	1.04	8.89
and	-	-	-	-	-	78	86	8	1.64	9.19
SUDD082	384244	4587433	479	92	-47	43	49	6	0.60	3.44
SUDPMK04	384357	4587659	444	85	-41	389	400	11	1.00	5.38
and	-	-	-	-	-	405	410.8	5.8	1.01	31.38
and	-	-	-	-	-	418.9	427.1	8.2	0.77	8.53

• 1) Coordinates are in UTM grid.

2) Cut-off grade of 0.6 g/t Au, 5.0 metres minimum length, 4.0 metres maximum internal dilution.

3) The true width has not been reported due to the disseminated style and variable geometries of mineralization.

The target delineation drilling campaign was completed during the second quarter of 2021 at the Synap prospect with 12 drill holes, for a total of 1,591 metres. The drilling to date confirms a large (> 500 metres along strike) zone of alteration and gold mineralization, close to the sediment-basement contact, with relatively low-grades, but good spatial continuity. Some assays are still pending, and upon receipt an internal review of the Synap prospect will be conducted.

Significant drill intercepts from the Synap prospect received during the second quarter of 2021:

						FROM	TO	LENGTH	Au
HOLE ID	EAST	NORTH	RL	AZ	DIP
						(m)	(m)	(m)	(g/t)
SYDD026	386571	4586942	334	227	-37	88	102	14	0.82
SYDPMK01	386746	4586772	304	130	-61	126	130	4	1.14
SYDPMK02	386707	4586819	322	50	-61	2	10	8	0.84
and	-	-	-	-	-	106	110	4	086
SYDPMK04	386744	4586775	304	41	-62	98	106	8	0.66

• 1) Coordinates are in UTM grid.

2) Cut-off grade of 0.6 g/t Au, 4.0 metres minimum length, 4.0 metres maximum internal dilution.

• 3) The true widths are 80-85% of downhole interval widths, based on the overall shape of the mineralized body.

During the second quarter of 2021 drilling at the Kuklitsa prospect was completed with 17 drill holes for a total of 1,972 metres. The program aims to provide data within the underexplored gap in the middle of the deposit, but also to test for possible extensions at the southern and northern flanks of the system. Drill holes confirmed the presence of low to moderate grade gold mineralization within a relatively wide zone of hydrothermal alteration. In the northern part of the Kukulitsa prospect a single interval, which fell outside of the reporting criteria in the table below, returned 148.8 g/t Au over 0.9 m within drill hole KUDD037. Drilling in this prospect will continue in autumn after receiving all the results from recent drilling and integrating with additional geological and geophysical data available.

Significant drill intercepts from the Kuklitsa prospects received during the second quarter of 2021:

						FROM	TO	LENGTH	Au
HOLE ID	EAST	NORTH	RL	AZ	DIP
						(m)	(m)	(m)	(g/t)
KUDD032	386550	4585344	403	111	-54	7	11	4	12.23
KUDD038	386557	4585721	355	124	-43	64.6	71	6.4	0.91
KUDD044	386736	4585937	329	83	-58	43	56	13	0.64
KUDPMK02	386736	4585936	329	292	-36	27	31	4	0.75
KUDPMK03	386736	4585934	328	131	-44	49	55	6	0.80
and	-	-	-	-	-	87	94	7	0.92

• 1) Coordinates are in UTM grid.

• 2) Cut-off grade of 0.6 g/t Au, 4.0 metres minimum length, 4.0 metres maximum internal dilution.

• 3) The true widths are generally 80-85% of downhole interval widths, based on the overall shape of the mineralized body.

DUNDEE PRECIOUS METALS INC. | 38

Preliminary metallurgical test works are planned for Kuklitsa and Synap as well as additional metallurgical testing at Surnak to support internal scoping studies and to better understand the geo-metallurgical variability.

During the second quarter of 2021, a ground magnetic survey was completed in the Khan Krum mining concession area with a total of 148.0 line kilometres infill along east-west traverses over an area of approximately 12.0 square kilometres. The aim was to gather additional geophysical data regarding potential fertile structures undercover and to support exploration targeting. Orientation surveys of radiometric, spectral and other geophysical methods, as well as structural and alteration mapping, are planned for this summer season for the entire Krumovgrad camp, in order to enhance the regional geological datasets and highlight additional exploration targets.

Timok Gold Project

DPM continues to advance exploration activities at Timok with a focus on adding resources to extend the project mine life. Exploration drilling at Timok was focused on shallow oxide resource delineation at the Chocolate and Chocolate south targets, proximal to Bigar Hill, as well as target delineation drilling on Čoka Rakita, Frasen and Potaj-Čuka-Tišnica (PCT) exploration license manto-skarn targets.

Additional drilling on the Chocolate, Chocolate South targets and Frasen have been completed in the second quarter of 2021 with 44 holes, for a total of 6,034 metres. The programs were designed to target shallow oxide-gold mineralization to support the growth of Mineral Resource inventories at the Timok gold project, as well as the extension at depth of higher-grade, sediment hosted, skarn mineralization at Frasen. While assays are pending for several holes, the table below summarize the significant intercepts received to date.

DUNDEE PRECIOUS METALS INC. | 39

Significant drill intercepts from the Chocolate and Chocolate South prospects received during the second quarter of 2021:

						FROM	TO	LENGTH	Au
HOLE ID	EAST	NORTH	RL	AZ	DIP
						(m)	(m)	(m)	(g/t)
BIDD168	571704	4897250	889	235	-45	42	56.6	14.6	0.83
and	-	-	-	-	-	57.2	65	7.8	0.43
BIDD172	571802	4897246	897	240	-45	11	17	6	0.23
and	-	-	-	-	-	88	100	12	0.22
and	-	-	-	-	-	133	139	6	0.21
BIDD180	571021	4897784	752	40	-45	0	5	5	1.16
BIDD181	570965	4897808	768	70	-50	63	75	12	0.49
BIDD183	571103	4897770	746	70	-45	1	7	6	0.22
and	-	-	-	-	-	45	84	39	0.67
and	-	-	-	-	-	91	107	16	0.35
BIDD185	571017	4897707	759	60	-45	33.4	49	15.6	0.98
BIDD188	571303	4897899	749	220	-45	69	78	9	0.5
BIDD189	571234	4897768	756	260	-45	61	81	20	0.56
BIDD193	571344	4897674	796	270	-45	31	68	37	1.38
BIDD194	571501	4897680	788	175	-45	42	47	5	0.27
BIDD195	571205	4897735	744	270	-45	46	53	7	0.54
BIDD197	571821	4897194	907	240	-60	87	97	10	0.27
and	-	-	-	-	-	139	166	27	0.38
BIDD200	571649	4897234	898	270	-60	29.5	38	8.5	0.42
BIDD202	571641	4896914	871	270	-45	2.6	11.8	9.2	0.28
and	-	-	-	-	-	17	41	24	0.36
BIDD203	571758	4897259	889	227	-45	54	60.5	6.5	0.23
and	-	-	-	-	-	77	91	14	1.71
and	-	-	-	-	-	101	106	5	0.25
BIDD204	571600	4896858	863	270	-65	19	29	10	0.88
BIDD205	571740	4897104	898	220	-45	50.8	59.2	8.4	0.33
BIDD206	571675	4897093	875	270	-45	0	11	11	0.65
BIDD208	571569	4896777	865	270	-45	62	87	25	0.24
BIDD209	571620	4897174	878	270	-45	10	31	21	0.23
BIDD210	571855	4897003	912	298	-45	95	100	5	0.52

1) Coordinates are in UTM 34 North.

2) Intervals are reported at a cut-off grade of 0.2 g/t Au using 5 metres minimum length and 5 metres maximum internal dilution.

3) The true widths are 80-85% of downhole interval widths, based on the overall shape of the mineralized body.

Drilling has been also completed at the Čoka Rakita prospect with definition at shallow levels of disseminated gold mineralization. At deeper levels, drilling revealed the potential for gold-rich skarn/mantotype mineralization within the contact zone of a carbonaceous sedimentary package and the fertile diorite intrusions, returning wide intercepts of strong skarn alteration with multiple holes awaiting assays.

Sampling, Analysis and QAQC of Exploration Core and Channel Samples

Most exploration diamond drill holes are collared with PQ size, continued with HQ, and are sometimes finished with NQ. Triple tube core barrels are used whenever possible to improve recovery. All drill core is cut lengthwise into two halves using a diamond saw; one half is sampled for assaying and the other half is retained in core trays. All drill core is sampled in intervals ranging up to three metres, however, the common length for sample intervals within mineralized zones is one metre. Weights of drill core samples range from three to eight kilograms, depending on the size of core, rock type, and recovery. A numbered tag is placed into each sample bag, and the samples are grouped into batches for laboratory submissions.

Core and channel samples from exploration programs at Chelopech, Ada Tepe and the Timok gold project are shipped to the Company’s own exploration laboratory in Bor, Serbia, which is managed by SGS Minerals.

DUNDEE PRECIOUS METALS INC. | 40

Quality control samples, comprising certified reference materials, blanks and field duplicates, are inserted into each batch of samples and locations for crushed duplicates are specified. All drill core and quality control samples are tabulated on sample submission forms that specify sample preparation procedures and codes for analytical methods. For internal quality control, the laboratory includes its own quality control samples comprising certified reference materials, blanks and pulp duplicates. All QAQC monitoring data are reviewed and signed off by an independent QAQC geologist. Chain of custody records are maintained from sample shipments to the laboratory until analyses are completed and remaining sample materials are returned to the Company. The chain of custody is transferred from the Company to SGS at the laboratory door.

Drill core samples submitted to the laboratory are dried at 105°C for a minimum of 12 hours, and then jaw crushed to about 80% passing 4 millimetres. Sample preparation duplicates are created by riffle splitting crushed samples on a 1 in 20 basis. Larger samples are riffle split prior to pulverizing, whereas smaller samples are pulverized entirely. Pulverizing specifications are 90% passing 70 microns.

Gold analyses are done using a conventional 50-gram fire assay and AAS finish. Multi-element analyses for 49 elements, including Ag, Cu, Mo, As, Bi, Pb, Sb, and Zn, are done using a four-acid digestion and an ICP-MS finish. Samples returning over 10 ppm for Ag and 1% for Cu, Pb and Zn are re-analyzed using high grade methods with AAS finish. Sulphur is analyzed using an Eltra Analyzer equipped with an induction furnace.

The Company’s QP has verified that all results reported in this disclosure have passed QAQC protocols. Further verification of results included comparison of assay data with geology, alteration and mineralization logging data.

DEVELOPMENT AND OTHER MAJOR PROJECTS

Timok Gold Project

The Timok gold project is a sediment hosted gold deposit located in the central-eastern region of the Republic of Serbia.

On February 23, 2021, DPM announced the results of the PFS for the Timok gold project which focused on the development of the oxide and transitional portions of the Mineral Resource. The PFS was based on the updated Mineral Resource Estimate, dated May 29, 2020, which considered primarily oxide and transitional material types.

The PFS included the following highlights:

• After-tax NPV[5%] of $135 million and internal rate of return of 21% assuming a gold price of $1,500 per ounce;

• 547,000 gold ounces recovered over an eight-year mine life, with annual gold production estimated to average approximately 80,000 ounces per annum in years 1 to 6, and approximately 70,000 ounces per annum over the life of mine; and

• Life of mine average all-in sustaining cost of $693 per ounce of gold.

Based on the positive results of the PFS, the Company proceeded with a FS, scheduled for completion in the first quarter of 2022 with the results planned for release in the second quarter of 2022. As a result of the decision to proceed with the FS, a budget of $11.9 million was approved for the completion of the FS phase of the project, including engineering, permitting and community engagement activities.

Initial capital for the Timok gold project is expected to be $211 million, with several initiatives to reduce the initial capital estimate and optimize overall economics, including the potential for contractor mining and adding resources associated with the Chocolate prospect to the mine plan, to be evaluated as part of the FS.

The FS engineering commenced in June 2021 and will continue to focus on the oxide portion of the deposit, however, DPM will also evaluate, in parallel with the FS, the potential for a mine plan incorporating the

DUNDEE PRECIOUS METALS INC. | 41

processing of the existing sulphide Mineral Resource portion of the ore body. The Company continued to advance FS fieldwork activities in the second quarter of 2021.

Permitting activities for the reservation of mineral rights and spatial planning commenced during the second quarter of 2021 with the objective of securing the mining rights for the project.

For additional details, including key assumptions, risks and parameters relating to the FS refer to the news release entitled “Dundee Precious Metals Announces Positive Pre-Feasibility Study and Encouraging New Exploration Results for the Timok Gold Project in Serbia” dated February 23, 2021 and the Technical Report entitled “NI 43-101 Technical Report, Timok Project, Pre-Feasibility Study, Zagubica, Serbia” effective March 30, 2021, which have been posted on the Company’s website at www.dundeeprecious.com and have been filed on SEDAR at www.sedar.com.

Tsumeb Rotary Holding Furnace

The Company continues to assess opportunities to further optimize the inherent value of the Tsumeb smelter operation, including the installation of a rotary holding furnace. The estimated upfront cost is expected to range between $47 million and $55 million, up from the prior estimate of $39 million due primarily to a change in scope and updated cost estimates. This furnace is expected to provide surge capacity between the Ausmelt furnace and the converters, increase smelter recoveries as well as potentially bring in additional third party feed and increase the proportion of third party volumes. These opportunities have the potential to generate additional value, with the rotary furnace installation being a potentially high return project that is expected to debottleneck and increase the annual throughput of complex concentrate by over 50% up to 370,000 tonnes and, in turn, generate significant incremental margins, given the fixed cost nature of the facility. As a result, the Company continues to take steps to support moving forward with this project, and in particular, securing adequate long-term supply of complex concentrate on acceptable terms.

Until such supply is secured, DPM will seek to process additional volumes of third party complex concentrates at Tsumeb, in lieu of Chelopech concentrate, when third party concentrates are available on acceptable terms and the Company can, in turn, capitalize on market demand for the Chelopech concentrate. While this has the potential to generate a net overall value for the Company, this would be realized through lower treatment charges and higher margins at Chelopech offset partially by lower revenue at Tsumeb. This could, in turn, result in the proposed expansion of the smelter being further delayed and possibly deferred indefinitely if an acceptable long term contract cannot be secured to support the expansion.

On December 13, 2019, the Government of Namibia issued an Environmental Clearance Certificate to Tsumeb, approving its proposed expansion to 370,000 tonnes per year, which remains valid until 2022 with an option to renew.

OFF BALANCE SHEET ARRANGEMENTS

The Company has not entered into any off-balance sheet arrangements.

DUNDEE PRECIOUS METALS INC. | 42

SELECTED QUARTERLY INFORMATION

Selected financial results for the last eight quarters, which have been prepared in accordance with IFRS, are shown in the table below:

$ millions except per share amounts	2021 Q2 Q1	2020 Q4 Q3 Q2 Q1	2019
			Q4 Q3
Revenue Net earnings (loss) Net earnings (loss) attributable to:  Continuing operations  Discontinued operations  Non-controlling interests Net earnings (loss) per share:  Continuing operations  Discontinued operations Net earnings (loss) diluted per share:  Continuing operations  Discontinued operations Adjusted net earnings(1) Adjusted basic earnings pershare(1)	174.7138.0 88.1 19.8 67.5 20.7 20.7 (0.7) (0.1) (0.2) 0.48 0.11 0.37 0.11 0.11 - 0.48 0.11 0.37 0.11 0.11 - 67.1 31.0 0.37 0.17	151.8 156.0 154.0 147.8 50.1 53.3 49.0 42.5 50.2 55.2 48.0 45.7 0.1 (1.5) 0.8 (2.5) (0.2) (0.4) 0.2 (0.7) 0.28 0.30 0.27 0.24 0.28 0.31 0.27 0.25 - (0.01) - (0.01) 0.27 0.29 0.27 0.24 0.27 0.30 0.27 0.25 - (0.01) - (0.01) 44.0 51.6 44.1 48.6 0.24 0.28 0.25 0.27	135.4 88.3 (93.3) 7.5 (90.4) 6.5 (2.3) 0.8 (0.6) 0.2 (0.52) 0.04 (0.51) 0.04 (0.01) - (0.52) 0.04 (0.51) 0.04 (0.01) - 16.1 3.4 0.09 0.02

• 1) Adjusted net earnings and adjusted basic earnings per share for the second, third and fourth quarters of 2020 were decreased by $0.9 million ($0.00 per share), $1.1 million ($0.01 per share) and $3.0 million ($0.02 per share), respectively, to conform with current period presentation. These adjustments pertain to a deferred tax recovery not related to current period earnings resulting from changes in unrecognized tax benefits triggered by unrealized gains on publicly traded securities, which, together with the related deferred income tax expense, were recognized in other comprehensive income (loss).

The variations in the Company’s quarterly results were driven largely by fluctuations in gold and copper grades and recoveries, volumes of complex concentrate smelted, gold, copper and acid prices, foreign exchange rates, smelter toll rates, smelter metal recoveries, depreciation, gains and losses related to Sabina special warrants, gains and losses on commodity swap contracts related to hedging the Company’s metal price exposures, realized gains or losses on foreign exchange option contracts related to hedging the Company’s foreign denominated operating expenditures, impairment charges and Ada Tepe achieving commercial production in June 2019, with first concentrate deliveries commencing in the third quarter of 2019.

The following table summarizes the quarterly average realized price for gold and copper and highlights the quarter over quarter variability:

Average	2021 Q2 Q1	2020 Q4 Q3 Q2 Q1	2019
			Q4 Q3
LBMA gold_($/ounce) LMEsettlement copper($/pound)_	1,8031,779 3.99 3.76	1,816 1,835 1,649 1,547 3.26 2.88 2.36 2.56	1,477 1,461 2.70 2.64

CRITICAL ACCOUNTING ESTIMATES

The preparation of the Company’s consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the amounts of assets, liabilities and contingent liabilities on the date of the consolidated financial statements and the amounts of revenues and expenses during the periods reported. Estimates and assumptions are evaluated and are based on management’s experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. However, actual outcomes can differ from these estimates.

The significant areas of estimation and uncertainty considered by management in preparing the condensed interim consolidated financial statements for the three and six months ended June 30, 2021 are the same as those described in the Company’s MD&A for the year ended December 31, 2020.

DUNDEE PRECIOUS METALS INC. | 43

NON-GAAP FINANCIAL MEASURES

Certain financial measures referred to in this MD&A are not measures recognized under IFRS and are referred to as Non-GAAP measures. These measures have no standardized meanings under IFRS and may not be comparable to similar measures presented by other companies. The definitions established and calculations performed by DPM are based on management’s reasonable judgment and are consistently applied. These measures are used by management and investors to assist with assessing the Company’s performance, including its ability to generate sufficient cash flow to meet its return objectives and support its investing activities and debt service obligations. In addition, the Human Capital and Compensation Committee of the Board of Directors uses certain of these measures, together with other measures, to set incentive compensation goals and assess performance. These measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS. Non-GAAP financial measures, together with other financial measures calculated in accordance with IFRS, are considered to be important factors that assist investors in assessing the Company’s performance.

Non-GAAP Cash Cost and All-in Sustaining Cost Measures

Cash cost per tonne of ore processed, cash cost per pound of copper in gold-copper concentrate produced, cash cost per ounce of gold in gold-copper concentrate produced, cash cost per ounce of gold in gold concentrate produced, cash cost per ounce of gold sold, net of by-product credits, all-in sustaining cost per ounce of gold and cash cost per tonne of complex concentrate smelted, net of by-product credits, capture the important components of the Company’s production and related costs. Management and investors utilize these metrics as an important tool to monitor cost performance at the Company’s operations. In addition, the Human Capital and Compensation Committee of the Board of Directors uses certain of these measures, together with other measures, to set incentive compensation goals and assess performance.

The following tables provide a reconciliation of the Company’s cash cost per tonne of ore processed, cash cost per pound of copper produced, cash cost per ounce of gold produced and cash cost per tonne of complex concentrate smelted, net of by-product credits to its cost of sales:

$ thousands, unless otherwise indicated
For the three months ended June 30, 2021	Chelopech	**Ada Tepe **	Tsumeb	Total
Ore processed_(mt)_	535,576	207,035	-
Metals contained in gold-copper concentrate
produced(1):
Gold_(ounces)_	34,616	32,490	-
Copper_(pounds)_	10,012,917	-	-
Complex concentrate smelted_(mt)_			59,627
Cost of sales	32,313	23,842	33,786	89,941
Add/(deduct):
Depreciation, amortization & other	(5,079)	(13,122)	(5,768)
Changeinconcentrateinventory	(407)	16	-
Total cash cost before by-product credits	26,827	10,736	28,018
By-product credits	(1,173)	(314)	**(4,179) **
Totalcashcost,net ofby-product credits	25,654	10,422	**23,839 **
Cash cost per tonne of ore processed(2)	50.09	51.86	-
Cash cost per pound of copper produced(2),(3)	1.07	-	-
Cash cost per ounce of gold produced(2),(3)	432	321	-
Cash cost per tonne of complex concentrate
smelted,net ofby-product credits(4)	-	-	400

• 1) Excludes metals contained in pyrite concentrate produced.

• 2) Cash costs are reported in U.S. dollars, although the majority of costs incurred are denominated in non-U.S. dollars, and consist of all production related expenses including mining, processing, services, royalties and general and administrative.

• 3) Gold and copper are accounted for as co-products. Total cash cost is net of by-product silver revenue.

• 4) Total cash cost is net of by-product acid revenue.

DUNDEE PRECIOUS METALS INC. | 44

$ thousands, unless otherwise indicated
For the three months ended June 30, 2020	Chelopech	**Ada Tepe **	Tsumeb	Total
Ore processed_(mt)_	555,958	224,539	-
Metals contained in gold-copper concentrate
produced(1):
Gold (ounces)	33,149	32,277	-
Copper (pounds)	9,378,230	-	-
Complex concentrate smelted_(mt)_	-	-	58,516
Cost of sales	27,376	25,052	30,513	82,941
Add/(deduct):
Depreciation, amortization & other	(7,442)	(14,318)	(4,083)
Changeinconcentrateinventory	1,001	(854)	-
Total cash cost before by-product credits	20,935	9,880	26,430
By-product credits	(669)	(176)	(6,214)
Totalcashcost,net ofby-product credits	20,266	9,704	20,216
Cash cost per tonne of ore processed(2)	37.65	44.00	-
Cash cost per pound of copper produced(2),(3)	0.62	-	-
Cash cost per ounce of gold produced(2),(3)	437	301	-
Cash cost per tonne of complex concentrate
smelted,net ofby-product credits(4)	-	-	345

• 1) Excludes metals contained in pyrite concentrate produced.

• 2) Cash costs are reported in U.S. dollars, although the majority of costs incurred are denominated in non-U.S. dollars, and consist of all production related expenses including mining, processing, services, royalties and general and administrative.

• 3) Gold and copper are accounted for as co-products. Total cash cost is net of by-product silver revenue.

• 4) Total cash cost is net of by-product acid revenue.

$ thousands, unless otherwise indicated
For the six months ended June 30, 2021	**Chelopech **	Ada Tepe	Tsumeb	**Total **
Ore processed_(mt)_	1,079,178	425,689	-
Metals contained in gold-copper concentrate
produced(1):
Gold_(ounces)_	58,551	65,869	-
Copper_(pounds)_	17,186,543	-	-
Complex concentrate smelted_(mt)_			82,636
Cost of sales	65,177	47,517	62,890	175,584
Add/(deduct):
Depreciation, amortization & other	(11,048)	(27,142)	(10,318)
Changeinconcentrateinventory	(4,665)	(176)	-
Total cash cost before by-product credits	49,464	20,199	52,572
By-product credits	(2,104)	(619)	**(6,474) **
Totalcashcost,net ofby-product credits	47,360	19,580	46,098
Cash cost per tonne of ore processed(2)	45.83	47.45	-
Cash cost per pound of copper produced(2),(3)	1.12	-	-
Cash cost per ounce of gold produced(2),(3)	481	297	-
Cash cost per tonne of complex concentrate
smelted,net ofby-product credits(4)	-	-	558

• 1) Excludes metals contained in pyrite concentrate produced.

• 2) Cash costs are reported in U.S. dollars, although the majority of costs incurred are denominated in non-U.S. dollars, and consist of all production related expenses including mining, processing, services, royalties and general and administrative.

• 3) Gold and copper are accounted for as co-products. Total cash cost is net of by-product silver revenue.

• 4) Total cash cost is net of by-product acid revenue.

DUNDEE PRECIOUS METALS INC. | 45

$ thousands, unless otherwise indicated
For the six months ended June 30, 2020	Chelopech	**Ada Tepe **	Tsumeb	Total
Ore processed_(mt)_	1,101,788	458,010	-
Metals contained in gold-copper concentrate
produced(1):
Gold (ounces)	61,689	62,609	-
Copper (pounds)	18,759,352	-	-
Complex concentrate smelted_(mt)_	-	-	123,526
Cost of sales	57,017	47,988	64,860	169,865
Add/(deduct):
Depreciation, amortization & other	(14,608)	(26,677)	(8,402)
Changeinconcentrateinventory	(1,670)	(2,078)	-
Total cash cost before by-product credits	40,739	19,233	56,458
By-product credits	(1,445)	(363)	(13,023)
Totalcashcost,net ofby-product credits	39,294	18,870	43,435
Cash cost per tonne of ore processed(2)	36.98	41.99	-
Cash cost per pound of copper produced(2),(3)	0.66	-	-
Cash cost per ounce of gold produced(2),(3)	437	301	-
Cash cost per tonne of complex concentrate
smelted,net ofby-product credits(4)	-	-	352

• 1) Excludes metals contained in pyrite concentrate produced.

• 2) Cash costs are reported in U.S. dollars, although the majority of costs incurred are denominated in non-U.S. dollars, and consist of all production related expenses including mining, processing, services, royalties and general and administrative.

• 3) Gold and copper are accounted for as co-products. Total cash cost is net of by-product silver revenue.

4) Total cash cost is net of by-product acid revenue.

The following table provides, for the periods indicated, a reconciliation of Chelopech cash cost per ounce of gold sold, net of by-product credits, and all-in sustaining cost per ounce of gold to its cost of sales:

$ thousands, unless otherwise indicated Ended June 30,	Three Months **Six Months **
	2021 2020 2021 2020
Cost of sales Add/(deduct): Depreciation, amortization & other Treatment charges, transportation and other related selling costs(1) By-product credits(2)	32,313 27,376 65,177 57,017 (5,079) (7,442) (11,048) (14,608) 30,484 26,785 50,817 53,030 (38,792) (20,749) (67,047) (45,926)
Cash cost of sales, net of by-product credits Rehabilitation related accretion expenses General and administrative expenses(3) Cash outlays for sustaining capital Cashoutlaysfor leases	18,926 25,970 37,899 49,513 63 74 114 153 1,418 5,056 3,521 6,025 4,409 2,743 6,524 4,335 219 153 426 277
All-in sustaining costs Payable gold in concentrate sold_(ounces)_(4) Cash cost per ounce of gold sold, net of by-product credits All-insustaining cost perounce ofgold	25,035 33,996 48,484 60,303 39,229 36,723 74,763 75,488 482 707 507 656 638 926 649 799

• 1) Includes treatment charges, transportation and other selling costs related to the sale of pyrite concentrate of $4.4 million (2020 – $4.4 million) and $10.3 million (2020 – $10.6 million) in the second quarter and first six months of 2021, respectively.

• 2) Represents copper and silver revenue.

• 3) Represents an allocated portion of DPM’s general and administrative expenses, including share-based compensation, based on Chelopech’s proportion of total revenue.

• 4) Includes payable gold in pyrite concentrate sold in the second quarter and first six months of 2021 of 7,239 ounces (2020 – 6,640 ounces) and 16,623 ounces (2020 – 15,747 ounces), respectively.

DUNDEE PRECIOUS METALS INC. | 46

The following table provides, for the periods indicated, a reconciliation of Ada Tepe cash cost per ounce of gold sold, net of by-product credits, and all-in sustaining cost per ounce of gold to its cost of sales:

$ thousands, unless otherwise indicated Ended June 30,	Three Months **Six Months **
	2021 2020 2021 2020
Cost of sales Add/(deduct): Depreciation, amortization & other Treatment charges, transportation and other related selling costs By-product credits(1)	23,842 25,052 47,517 47,988 (13,122) (14,318) (27,142) (26,677) 889 1,024 1,945 1,942 (268) (170) (526) (337)
Cash cost of sales, net of by-product credits Rehabilitation related accretion expenses General and administrative expenses(2) Cash outlays for sustaining capital Cashoutlaysfor leases	11,341 11,588 21,794 22,916 30 26 61 55 966 4,194 2,650 4,854 4,854 1,526 7,321 3,453 365 288 762 520
All-in sustaining costs Payable gold in concentrate sold_(ounces)_ Cash cost per ounce of gold sold, net of by-product credits All-insustaining cost perounce ofgold	17,556 17,622 32,588 31,798 31,201 34,115 64,234 63,604 363 340 339 360 563 517 507 500

1) Represents silver revenue.

• 2) Represents an allocated portion of DPM’s general and administrative expenses, including share-based compensation, based on Ada Tepe’s proportion of total revenue.

DPM’s cash cost per ounce of gold sold, net of by-product credits, and all-in sustaining cost per ounce of gold calculations are set out in the following table:

$ thousands, unless otherwise indicated Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Cash cost of sales, net of by-product credits(1) Rehabilitation related accretion expenses(1) General and administrative expenses(2) Cash outlays for sustaining capital(1) Cashoutlaysfor leases(1)	30,267 37,558 93 100 2,384 9,250 9,263 4,268 584 441	59,693 72,429 175 208 6,171 10,879 13,845 7,787 1,188 797
All-in sustaining costs Payable gold in concentrate sold_(ounces)_ Cash cost per ounce of gold sold, net of by-product credits All-insustaining cost perounce ofgold	42,591 51,617 70,430 70,838 430 530 605 729	81,072 92,100 138,997 139,092 429 521 583 662

• 1) Represents the cash cost of sales, net of by-product credits, rehabilitation related accretion expenses, cash outlays for sustaining capital expenditures and leases that are specific to Chelopech and Ada Tepe.

• 2) Represents an allocated portion of DPM’s general and administrative expenses, including share-based compensation, based on Chelopech and Ada Tepe’s proportion of total revenue.

Adjusted net earnings and adjusted basic earnings per share

Adjusted net earnings and adjusted basic earnings per share are used by management and investors to measure the underlying operating performance of the Company. Presenting these measures from period to period helps management and investors evaluate earnings trends more readily in comparison with results from prior periods.

Adjusted net earnings are defined as net earnings attributable to common shareholders, adjusted to exclude specific items that are significant, but not reflective of the underlying operations of the Company, including:

• impairment charges or reversals thereof;

• unrealized and realized gains or losses related to investments carried at fair value;

• significant tax adjustments not related to current period earnings; and

DUNDEE PRECIOUS METALS INC. | 47

• non-recurring or unusual income or expenses that are either not related to the Company’s operating segments or unlikely to occur on a regular basis.

The following table provides a reconciliation of adjusted net earnings to net earnings attributable to common shareholders from continuing operations:

$ thousands, except per share amounts Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Net earnings attributable to common shareholders from continuing operations Add/(deduct): Net losses (gains) related to Sabina special warrants, net of income taxes of $nil for all periods Deferred tax recovery (expense) adjustments not related to current period earnings(1)	67,502 48,047 231 (3,069) (617) (880)	88,221 93,748 5,630 (114) 4,287 (880)
Adjustednet earnings	67,116 44,098	98,138 92,754
Basic earnings per share Adjusted basic earnings pershare	0.37 0.27 0.37 0.25	0.49 0.52 0.54 0.52

1) Represents changes in unrecognized tax benefits included in net earnings related to unrealized gains or losses on publicly traded securities, which, together with the related deferred income tax recovery (expense), were recognized in other comprehensive income (loss).

Adjusted EBITDA

Adjusted EBITDA is used by management and investors to measure the underlying operating performance of the Company’s operating segments. Presenting these measures from period to period helps management and investors evaluate earnings trends more readily in comparison with results from prior periods. In addition, the Human Capital and Compensation Committee of the Board of Directors uses adjusted EBITDA, together with other measures, to set incentive compensation goals and assess performance.

Adjusted EBITDA excludes the following from earnings before income taxes:

• depreciation and amortization;

• interest income;

• finance cost;

• impairment charges or reversals thereof;

• unrealized and realized gains or losses related to investments carried at fair value; and

• non-recurring or unusual income or expenses that are either not related to the Company’s operating segments or unlikely to occur on a regular basis.

The following table provides a reconciliation of adjusted EBITDA to earnings before income taxes:

$ thousands Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Earnings before income taxes Add/(deduct): Depreciation and amortization Finance cost Interest income Net losses (gains) related to Sabina special warrants	74,932 52,961 24,247 26,031 1,314 1,709 (92) (24) 231 (3,069)	110,209 104,344 48,425 50,087 2,717 3,928 (184) (66) 5,630 (114)
AdjustedEBITDA	100,632 77,608	166,797 158,179

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Free cash flow

Free cash flow is defined as cash provided from operating activities, before changes in working capital, less cash outlays for sustaining capital, mandatory principal repayments and interest payments related to debt and leases. This measure is used by the Company and investors to measure the cash flow available to fund the Company’s growth capital expenditures.

DPM’s free cash flow calculation is set out in the following table:

$ thousands Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Cash provided from operating activities Add changesin working capital	75,697 73,595 8,976 (6,268)	123,288 84,590 24,253 40,954
Cash provided from operating activities, before changes in working capital Cash outlays for sustaining capital Principal repayments related to leases Interest payments	84,673 67,327 (15,936) (5,773) (1,062) (984) (630) (702)	147,541 125,544 (26,158) (11,855) (2,119) (1,907) (1,212) (1,481)
Free cash flow	67,045 59,868	118,052 110,301

Cash provided from operating activities, before changes in working capital

Cash provided from operating activities, before changes in working capital, is defined as cash provided from operating activities excluding changes in working capital as set out in the Company’s consolidated statements of cash flows. This measure is used by the Company and investors to measure the cash flow generated by the Company’s operating segments prior to any changes in working capital, which at times can distort performance.

Growth capital expenditures

Growth capital expenditures are generally defined as capital expenditures that expand existing capacity, increase life of assets and/or increase future earnings. This measure is used by management and investors to assess the extent of discretionary capital spending being undertaken by the Company each period.

Sustaining capital expenditures

Sustaining capital expenditures are generally defined as expenditures that support the ongoing operation of the asset or business without any associated increase in capacity, life of assets or future earnings. This measure is used by management and investors to assess the extent of non-discretionary capital spending being incurred by the Company each period.

Average realized price reconciliation

Average realized gold and copper prices are used by management and investors to highlight the price actually realized by the Company relative to the average market price, which can differ due to the timing of sales, hedging and other factors.

Average realized gold and copper prices represent the average per unit price recognized in the Company’s consolidated statements of earnings (loss) prior to any deductions for treatment charges, refining charges, penalties, freight and final settlements to adjust for any cost differences relative to the provisional invoice.

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The following table provides a reconciliation of the Company’s average realized gold and copper prices to its revenue:

$ thousands, unless otherwise indicated Ended June 30,	Three Months 2021 2020	Six Months
		2021 2020
Total revenue Add/(deduct): Tsumeb revenue Treatment charges and other deductions Silver revenue	174,736 154,028 (40,077) (38,261) 31,374 21,970 (1,326) (719)	312,766 301,815 (48,985) (79,885) 52,763 46,705 (2,449) (1,696)
Revenue from gold and copper Revenue from gold Payable gold in concentrate sold_(ounces) Average realized gold price per ounce Revenue from copper Payable copper in concentrate sold(‘000s pounds)_ Average realized copperpriceperpound	164,707 137,018 126,973 116,816 70,430 70,838 1,803 1,649 37,734 20,202 9,468 8,543 3.99 2.36	314,095 266,939 248,971 222,371 138,997 139,092 1,791 1,599 65,124 44,568 16,747 18,063 3.89 2.47

RISKS AND UNCERTAINTIES

The operating results and financial condition of the Company are subject to a number of inherent risks and uncertainties associated with its business activities, which include the acquisition, exploration, development, financing, construction, commissioning and operation of its mine, mill and concentrate processing facilities. The operating results and financial condition are also subject to numerous external factors, which include economic, social, geo-political, environmental, regulatory, health, legal, tax and market risks impacting, among other things, precious metals and copper prices, acid prices, toll rates, foreign exchange rates, inflation, the availability and cost of capital to fund the capital requirements of the business and the supply chain related to the business. Each of these risks could have a material adverse impact on the Company’s future business, results of operations and financial condition, and could cause actual results to differ materially from those described in any Forward Looking Statements contained in this MD&A. The Company endeavors to manage these risks and uncertainties in a balanced manner with a view to mitigating risk while maximizing total shareholder returns. The Company continually strives to identify and to effectively manage the risks of each of its business units. This includes developing appropriate risk management strategies, policies, processes and systems. There can be no assurance that the Company has been or will be successful in identifying all risks or that any risk-mitigating strategies adopted to reduce or eliminate risk will be successful.

A comprehensive discussion of the risks faced by the Company can be found in the Company’s 2020 Annual MD&A and AIF. These risks, including the risk related to COVID-19, discussed below, along with other potential risks not specifically discussed in the Company’s MD&A and AIF, should be considered when evaluating the Company and its guidance. Additional risks not identified by the Company may also affect the Company.

COVID-19

The COVID-19 pandemic and the emergence of multiple COVID-19 variants has had an adverse impact on global economic conditions. Any future emergence and spread of similar or other pathogens could have a similar adverse impact. The COVID-19 pandemic may continue or worsen which may adversely impact the Company’s operations, and the operations of its suppliers, contractors and service providers, the ability to obtain financing and maintain necessary liquidity, the demand for and ability to transport the Company’s products and its ability to advance its projects and other growth initiatives.

The outbreak and resurgence of COVID-19 continues to significantly impact global economies and the global upheavals have caused significant volatility in commodity prices. The outbreak and its declaration as a global pandemic caused companies and governments around the world to impose sweeping restrictions on the movement of people and goods, including social distancing measures and restrictions on group gatherings, isolation and quarantine requirements, closure of business and government offices, travel advisories and travel restrictions. The duration of the various disruptions to businesses locally and internationally and the related financial impact cannot be reasonably estimated at this time. Furthermore,

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governments in relevant jurisdictions may introduce new, or modify existing, laws, regulations, orders or other measures that could impact the Company’s ability to operate or affect the actions of its suppliers, contractors and service providers.

Authorities in the jurisdictions in which the Company operates mandated restrictions and additional measures to contain the spread of COVID-19. While there is some easing of restrictions, should these measures and ongoing vaccination efforts be insufficient to contain the spread and impact of COVID-19, this may lead to further economic downturn that may adversely impact the Company’s business, financial condition and results of operations. The outbreak and resurgence of COVID-19 may also continue to affect financial markets, may adversely affect the Company’s ability to raise capital, if required, and may cause continued interest rate volatility and movements that may make obtaining financing or extending existing credit facilities, if required, more challenging or more expensive or unavailable on commercially reasonable terms or at all. In addition, if any number of employees, contractors or consultants of the Company or any key supplier become infected with COVID-19 or similar pathogens and/or the Company is unable to source necessary replacements, consumables or supplies or transport its products, due to government restrictions or otherwise, it could have a material negative impact on the Company’s operations and prospects, including the partial or complete shutdown, delays in planned activities, including maintenance, or other disruption of one or more of its operations. Furthermore, an outbreak of COVID-19 at the Company’s operations could cause reputational harm and negatively impact the Company’s social license to operate. The COVID-19 pandemic has also increased cybersecurity and information technology risks due to the rise in fraudulent activity and increased number of employees working remotely.

Although the Company has not experienced any material disruptions to its operations to date, as a result of measures it has taken, there is no assurance the Company will not be adversely affected by the current COVID-19 pandemic or other potential future health crises. The Company will continue to work actively to monitor the situation and implement further measures as required to mitigate and/or deal with any repercussions that may occur as a result of the COVID-19 outbreak.

DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company’s management, under the supervision of the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), has designed disclosure controls and procedures (“DC&P”) and internal control over financial reporting (“ICFR”), as defined in National Instrument 52-109, Certification of Disclosure in Issuers’ Annual and Interim Filings (“NI 52-109”), based on the Internal Control – Integrated Framework (2013) developed by COSO (Committee of Sponsoring Organizations of the Treadway Commission).

DC&P are designed to provide reasonable assurance that material information relating to the Company is made known to the CEO and CFO during the reporting period and the information required to be disclosed by the Company in its reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation. ICFR is designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with IFRS. Due to the inherent limitations associated with any such controls and procedures, management recognizes that, no matter how well designed and operated, they may not prevent or detect misstatements on a timely basis.

The Company’s management, under the supervision of the CEO and the CFO, has evaluated its DC&P and ICFR and concluded that, as at June 30, 2021, they have been designed effectively to provide reasonable assurance regarding required disclosures and the reliability of financial reporting and the preparation of financial statements for external purposes.

NI 52-109 also requires Canadian public companies to disclose any change in ICFR during the most recent fiscal quarter that has materially affected, or is reasonable likely to materially affect, ICFR. No material changes were made to the ICFR in the first six months of 2021.

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CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain statements and other information included in this MD&A and our other disclosure documents constitute “forward looking information” or “forward looking statements” within the meaning of applicable securities legislation, which we refer to collectively hereinafter as “Forward Looking Statements”.

Forward Looking Statements are statements that are not historical facts and are generally, but not always, identified by the use of forward looking terminology such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “outlook”, “intends”, “anticipates”, “believes”, or variations of such words and phrases or that state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms or similar expressions. The Forward Looking Statements in this MD&A relate to, among other things: measures the Company is undertaking in response to the COVID-19 outbreak, including its impacts on the Company’s global supply chains, the level of and duration of reductions or curtailments in operating levels at any of the Company’s operations or in its exploration and development activities; expected cash flows; the price of gold, copper, silver and acid, toll rates, metals exposure and stockpile interest deductions at Tsumeb; Tsumeb’s ability to continue to benefit from EPZ/SEZ tax incentives in Namibia; the estimation of Mineral Reserves and Mineral Resources and the realization of such mineral estimates; estimated capital costs, operating costs and other financial metrics, including those set out in the three-year outlook provided by the Company; currency fluctuations; the impact of any impairment charges; the processing of Chelopech concentrate; timing of further optimization work at Tsumeb; potential benefits of any upgrades and/or expansion, including the planned rotary furnace installation, at the Tsumeb smelter; results of economic studies (including the PFS); success of exploration activities; the timing of the completion and results of a FS for the Timok gold project; expectations with respect to the potential to incorporate additional existing Mineral Resources into the Timok mine plan by processing the sulphide portion of the ore body; success of permitting activities; permitting timelines; success of investments, including potential acquisitions and in particular the acquisition of INV; requirements for additional capital; government regulation of mining and smelting operations; environmental risks; reclamation expenses; potential or anticipated outcome of title disputes or claims; benefits of digital initiatives; the payment of dividends; the timing and number of common shares of the Company that may be purchased pursuant to the Bid; and timing and possible outcome of pending litigation or legal proceedings, if any.

Forward Looking Statements are based on certain key assumptions and the opinions and estimates of management and QP (in the case of technical and scientific information), as of the date such statements are made, and they involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any other future results, performance or achievements expressed or implied by the Forward Looking Statements. In addition to factors already discussed in this document, such factors include, among others: risks relating to the Company’s business generally and the impact of global pandemics, including COVID-19, including changes to the Company’s supply chain, product shortages, delivery and shipping issues, closure and/or failure of plant, equipment or processes to operate as anticipated, employees and contractors becoming infected, lost work hours and labour force shortages; fluctuations in metal and acid prices, toll rates and foreign exchange rates; possible variations in ore grade and recovery rates; inherent uncertainties in respect of conclusions of economic evaluations and economic studies, including the PFS and the FS; uncertainties with respect to timing of the FS; changes in project parameters, including schedule and budget, as plans continue to be refined; uncertainties with respect to realizing the anticipated benefits from the acquisition of INV; uncertainties with respect to actual results of current exploration activities; uncertainties and risks inherent to developing and commissioning new mines into production, which may be subject to unforeseen delays; uncertainties inherent with conducting business in foreign jurisdictions where corruption, civil unrest, political instability and uncertainties with the rule of law may impact the Company’s activities; limitations on insurance coverage; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; actual results of current and planned reclamation activities; opposition by social and non-governmental organizations to mining projects and smelting operations; unanticipated title disputes; claims or litigation; failure to achieve certain cost savings or the potential benefits of any upgrades and/or expansion, including the planned rotary furnace installation, at the Tsumeb smelter; cyber-attacks and other cybersecurity risks; there being no assurance that the Company will purchase additional common shares of the Company under the Bid; risks related to the implementation, cost and realization of benefits from digital initiatives; discretion of the Company with respect to the use of proceeds from the sale of MineRP; uncertainties with respect to

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realizing the targeted MineRP earn-outs as well as those risk factors discussed or referred to in any other documents (including without limitation the Company’s most recent AIF) filed from time to time with the securities regulatory authorities in all provinces and territories of Canada and available on SEDAR at www.sedar.com.

This list is not exhaustive of the factors that may affect any of the Company’s Forward Looking Statements. The Forward Looking Statements are based on what the Company’s management considers to be reasonable assumptions, beliefs, expectations and opinions based on the information currently available to it. Without limitation to the foregoing, the following section outlines certain specific Forward Looking Statements contained in the “Three-Year Outlook” section of this MD&A, unless otherwise noted, and provides certain material assumptions used to develop such Forward Looking Statements and material risk factors that could cause actual results to differ materially from the Forward Looking Statements (which are provided without limitation to the additional general risk factors discussed herein):

Ore processed: assumes Chelopech and Ada Tepe mines perform at planned levels. Subject to a number of risks, the more significant of which is failure of plant, equipment or processes to operate as anticipated.

Cash cost per tonne of ore processed: assumes Chelopech and Ada Tepe ore mined/milled are in line with the guidance provided; foreign exchange rates remain at or around current levels; and operating expenses at Chelopech and Ada Tepe are at planned levels. Subject to a number of risks, the more significant of which are: lower than anticipated ore mined/milled; a weaker U.S. dollar relative to the Euro; and unexpected increases in labour and other operating costs.

Metals contained in concentrate produced: assumes grades and recoveries are consistent with current estimates of Mineral Resources and Mineral Reserves and DPM’s current expectations; and ore mined/milled is consistent with guidance. Subject to a number of risks, the more significant of which are: lower than anticipated ore grades, recovery rates and ore mined/milled.

All-in sustaining costs: assumes that metals contained in concentrate produced and cash cost per tonne of ore processed at Chelopech and Ada Tepe are each in line with the guidance provided; copper and silver prices remain at or around current levels; the timing, destination and commercial terms in respect of concentrate deliveries are consistent with DPM’s current expectations; payable metals in concentrate sold are consistent with the guidance provided, and general and administrative expenses, sustaining capital expenditures and leases are consistent with the guidance provided. Subject to a number of risks, the more significant of which are: lower than anticipated metals contained in concentrate produced, concentrate deliveries and metal prices; a higher than anticipated cash cost per tonne of ore processed; and higher than anticipated sustaining capital expenditures, leases and general and administrative expenses.

Complex concentrate smelted at Tsumeb: assumes no significant disruption in equipment availability, planned maintenance activities or concentrate supply. Subject to a number of risks, the more significant of which are: unanticipated operational issues; delays in maintenance activities; lower than anticipated equipment availability; and disruptions to or changes in the supply of complex concentrate, including changes in the proportion of third party and Chelopech feed.

Cash cost per tonne of complex concentrate smelted: assumes complex concentrate smelted is consistent with the guidance provided; no delays in planned maintenance activities; acid prices are at or around current levels; acid production and operating expenses are at planned levels; and foreign exchange rates remain at or around current levels. Subject to a number of risks, the more significant of which are: complex concentrate smelted and acid production are lower than anticipated; acid prices are lower than anticipated; strengthening of the ZAR relative to the U.S. dollar; and higher than anticipated operating and transportation costs due to a variety of factors, including higher than anticipated inflation, labour and other operating costs.

Sustaining and growth capital expenditures: assumes foreign exchange rates remain at or around current levels, and all capital projects proceed as planned and at a cost that is consistent with the budget established for each project. Subject to a number of risks, the more significant of which are: technical challenges, delays related to securing necessary approvals, equipment deliveries, equipment performance, and the speed with which work is performed; availability of qualified labour; and changes in project parameters and estimated costs, including foreign exchange impacts.

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Liquidity (see comments contained in “Liquidity and Capital Resources” section): assumes the operating and cost performance are consistent with current expectations; metal and acid prices, and foreign exchange rates remain at or around current levels; concentrate and acid sales agreements, and smelter toll terms are consistent with current terms and/or forecast levels; progress of capital projects is consistent with current expectations; and DPM’s RCF remains in place. Subject to a number of risks, the more significant of which are: lower than anticipated metals production at Chelopech and Ada Tepe, complex concentrate throughput and acid production at Tsumeb, concentrate deliveries and metal prices; lower than anticipated reductions in secondary material at Tsumeb; a weaker U.S. dollar relative to local operating currencies; changes in contractual sales and/or toll terms and acid prices; changes to capital project parameters, schedule and/or costs; and the inability to draw down on DPM’s RCF due to a breach or potential breach of one of its covenants.

General: assumes ability to carry on exploration and development activities; ability to operate in a safe, efficient and effective manner; no significant unanticipated operational or technical difficulties; maintenance of good relations with the communities surrounding Chelopech, Ada Tepe and Tsumeb; and no significant events or changes relating to regulatory, environmental, health and safety matters, including that the Company does not experience any negative effects as a result of the COVID-19 pandemic.

The reader is cautioned that the foregoing list is not exhaustive of all factors and assumptions which may have been used. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in Forward Looking Statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that Forward Looking Statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company’s Forward Looking Statements reflect current expectations regarding future events and are only as of the date hereof. Other than as it may be required by law, the Company undertakes no obligation to update Forward Looking Statements if circumstances or management’s estimates or opinion should change. Accordingly, readers are cautioned not to place undue reliance on Forward Looking Statements.

CAUTIONARY NOTE TO UNITED STATES INVESTORS CONCERNING DIFFERENCES IN REPORTING OF MINERAL RESOURCE ESTIMATES

This MD&A has been prepared in accordance with the requirements of Canadian securities laws, which differ from the requirements of United States securities laws. Canadian reporting requirements for disclosure of mineral properties are governed by NI 43-101. Subject to the SEC Modernization Rules described below, the United States reporting requirements are currently governed by the United States Securities and Exchange Commission (“SEC”) Industry Guide 7 (“SEC Industry Guide 7”) under the Securities Act of 1933. The definitions used in NI 43-101 are incorporated by reference from the CIM – Definition Standards adopted by CIM Council on May 10, 2014 (the “CIM Definition Standards”). For example, the terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” are Canadian mining terms as defined in NI 43-101, and these definitions differ from the definitions in SEC Industry Guide 7. Furthermore, while the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in NI 43-101, these terms are not defined terms under SEC Industry Guide 7. Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority. Further, under SEC Industry Guide 7, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. Any reserves reported by the Company in the future and in compliance with NI 43-101 may not qualify as “reserves” under SEC Industry Guide 7. Further, until recently, the SEC has not recognized the reporting of mineral deposits which do not meet the SEC Industry Guide 7 definition of “reserve”. The SEC adopted amendments to its disclosure rules to modernize the mineral property disclosure requirements for issuers whose securities are registered with the SEC under the Securities Exchange Act of 1934, as amended. These amendments became effective February 25, 2019 (the “SEC Modernization Rules”) with compliance required for the first fiscal year beginning on or after January 1, 2021. The SEC Modernization Rules replace the historical disclosure requirements for mining issuers that were included in SEC Industry Guide 7, which will be rescinded from and after the required compliance date of the SEC Modernization Rules. As a result

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of the adoption of the SEC Modernization Rules, the SEC now recognizes estimates of “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources”. In addition, the SEC has amended its definitions of “proven mineral reserves” and “probable mineral reserves” to be “substantially similar” to the corresponding CIM Definition Standards, incorporated by reference in NI 43-101. Readers are cautioned that while the above terms are “substantially similar” to the corresponding CIM Definition Standards, there are differences in the definitions under the SEC Modernization Rules and the CIM Definition Standards. Accordingly, there is no assurance any mineral reserves or mineral resources that the Company may report as “proven mineral reserves”, “probable mineral reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43-101 would be the same had the Company prepared the reserve or resource estimates under the standards adopted under the SEC Modernization Rules. Readers are also cautioned that while the SEC will now recognize “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources”, it should not be assumed that any part or all of the mineralization in these categories will ever be converted into a higher category of mineral resources or into mineral reserves. Mineralization described using these terms has a greater amount of uncertainty as to their existence and feasibility than mineralization that has been characterized as reserves. Accordingly, readers are cautioned not to assume that any “measured mineral resources”, “indicated mineral resources” or “inferred mineral resources” that the Company reports are or will be economically or legally mineable. Further, “inferred mineral resources” have a greater amount of uncertainty as to their existence and as to whether they can be mined legally or economically. Therefore, readers are also cautioned not to assume that all or any part of the “inferred mineral resources” exist. In accordance with Canadian securities laws, estimates of “inferred mineral resources” cannot form the basis of feasibility or other economic studies, except in limited circumstances where permitted under NI 43-101. For the above reasons, information contained in this MD&A containing descriptions of the Company’s mineral deposits may not be comparable to similar information made public by United States companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.

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