Fortuna Silver Mines Q1 2025 Earnings Call Transcript

Quartr
Provided by Quartr
May 8, 2025

There are 10 speakers on the call.

Operator

Good afternoon, everyone, and welcome to the Fortuna Mining Corporation Q1 twenty twenty five Financial and Operational Results Call. At this time, all participants are in a listen only mode and the floor will be open for questions following the presentation. Please note this conference is being recorded. I will now turn the conference over to your host, Carlos Baca, Vice President of Investor Relations. The floor is yours.

Speaker 1

Thank you, Jenny. Good morning, ladies and gentlemen, and welcome to Fortuna Mining's first quarter twenty twenty five Financial and Operational Results Conference Call. Hosting today's call on behalf of Fortuna are Jorge Alberto Manosa, President, Chief Executive Officer and Co Founder Guizarillo Manosa, Chief Financial Officer Cesar Belaco, Chief Operating Officer, Latin America David Will, Chief Operating Officer, West Africa. Today's earnings call presentation is available on our website at fortunamining.com. Before we begin, please note that statements made during this call are subject to the reader advisories included in yesterday's news release, the webcast presentation, our management discussion and analysis and the risk factors set out in our annual information form.

Speaker 1

All financial figures discussed today are in U. S. Dollars unless otherwise stated. Technical information in the presentation has been reviewed and approved by Eric Chapman, Fortuna's Senior Vice President of Technical Services and a qualified person as defined by National Instrument 40 three-one hundred one. I will now turn the call over to Jorge Alberto Anosa, President, Chief Executive Officer and Co Founder of Fortuna Mining.

Speaker 2

Hello to everyone, and thanks for joining us today. Q1 was another great quarter for us at Fortuna. After a record setting in Q4, we kept the momentum going with a second straight quarter of record free cash flow from operations. We're making the most of strong gold prices, keeping our costs under control and continuing to grow our margins. Cash flow was a standout again this quarter.

Speaker 2

Free cash flow from ongoing operations hit a record $111,000,000 beating our Q4 record of $96,000,000 That puts our free cash flow margin at 38%, up from 31% in Q4. Net cash from operations before working capital changes was $138,000,000 or $0.45 per share. We adjust for the San Jose mine divestment that jumps to $144,000,000 or $0.48 per share. Another nice setup. What's driving this simply put discipline on cost control in a strong gold price.

Speaker 2

We brought our cash cost per ounce down to $929 on a consolidated basis from $10.15 dollars in Q4. And our consolidated all in sustaining cost came in at $16.40 dollars well below last quarter's $17.72 dollars That kind of discipline is paying off. Net income from continued operations came in at a strong $61,700,000 or $0.20 per share, a big jump from $11,000,000 or $04 per share in Q4. That was mainly thanks to an 8% increase in gold price and a lower effective tax rate as a result of the appreciation of the euro. We generated sales of $290,000,000 and produced 103 gold equivalent ounces, right in line with our plans.

Speaker 2

This includes the impact of the sale of our San Jose mine, which had contributed about 11,000 gold equivalent ounces in Q4. All our mines stayed within production guidance in the quarter and Seguela once again outperformed, coming in approximately 4,000 ounces above the midpoint of our guidance on previous quarter. This, thanks to higher processed ore and a drawdown of gold in circuit inventory. We continue to further improve our financial strength. Our net cash position more than doubled to $137,000,000 and total liquidity rose to $462,000,000 up from $381,000,000 in the fourth quarter.

Speaker 2

That kind of financial strength gives us flexibility, whether that's for investing in growth, returning capital to shareholders or navigating market shifts. On that note, we continued buying back shares. In Q1, we repurchased and canceled just over 900,000 shares at an average price of US4.53 dollars On growth capital and exploration, we're staying focused on high impact opportunities across the portfolio. We have budgeted $51,000,000 for 2025 for exploration and new project programs. We're going strong with targeted work at the Kingfisher and San Bernardin deposits at the Seguera mine, the Tongon North prospect in Northern Cote D'Ivoire, the Diamba suit advanced project in Senegal and the Arizaro gold porphyry at the Lindero mine in Argentina.

Speaker 2

These are exciting projects and prospects with long term upside, and we're putting capital to work where it counts. In 2025, we're also advancing with key capital projects that will enable the Seguela mine to expand production in 2026 to approximately 180,000 ounces of annual production. David Widdle, our Chief Operating Officer for West Africa, expand on that later on the call. During the first quarter, we continued to actively optimize our asset portfolio divesting of assets with high costs or limited life of mine. The sale of the San Jose mine in Mexico closed in April, marking a key step in streamlining our operations.

Speaker 2

San Jose had become our highest cost mine and was nearing the end of its mineral reserves, so this was a timely and strategic divestment. As for the Yaramoko mine in Burkina Faso, we announced its sale on April 11. Like San Jose, Yaramuco is approaching the end of its mine life with mineral reserves expected to be depleted by early twenty twenty six. The decision to sell was driven by a compelling offer and gives us a prudent exit from a country where we are no longer investing in mineral exploration and where the business and security environment continues to present challenges. The sale provides for cash consideration of $70,000,000 and is subject to the payment of cash dividends by Roxgold Sano, owner of the Yaramunco mine, to Fortuna in the amount of $57,500,000 prior to close.

Speaker 2

We expect the sale to close in mid May. Taken together, these two sales allow us to reallocate approximately $50,000,000 in capital and management focus away from mine closures and towards higher value opportunities that better align with our long term strategic objectives. On the safety front, I'm pleased to report that we had zero lost time injuries in Q1 and our total recordable injury frequency rate improved to zero point nine eight, down from one point three three in the fourth quarter. That's a strong result. I want to thank our team for their continued vigilance and dedication to save work practice.

Speaker 2

However, this progress was overshadowed by a tragic incident in February at Seguela, where a subcontractor lost his life while performing ancillary activities. This is a heartbreaking reminder that safety must remain our highest priority always. Our commitment to zero harm workplace is unwavering. In Argentina, I'd like to comment that we continue to see positive economic policy changes. The government has started easing capital exchange rate controls and introduced a managed floating exchange rate.

Speaker 2

This opens the door for us to repatriate twenty twenty five dividends plus about $38,000,000 currently in country, and we're targeting the second half of the year to begin that process. In closing, Q1 twenty twenty five was a strong quarter on all fronts. We hit back to back free cash flow records, improved margins, strengthened further our balance sheet and continued to optimize the portfolio. We're in a great position to keep delivering for our shareholders, our people and the communities we operate in. We'll now move on to an update from our Chief Operating Officer, who

Speaker 3

will start with West Africa. David? Thanks, Jorge. Together in Yaramaiko, we delivered a successful first quarter with strong results from a production and operational perspective. Safety remains a core priority, and we continue to advance our goal of achieving zero harm across all operations.

Speaker 3

Yaramoko maintained an excellent safety record with no major injuries and continues to operate more than four point five years without a lost time incident. During the first quarter, Sagalha produced 38,500 ounces of gold, representing 9% improvement compared to the previous quarter. This exceeded the mine plan and supports expectations to achieve annual production at the higher end of guidance. Yaramoka also delivered strong performance with gold production of 33,073 ounces, reflecting a 12% improvement over the prior quarter. At Sagalah, Four Hundred And Seventy Seven Thousand tonnes of ore were mined at an average gold grade of 2.53 grams per tonne, along with 5,470,000 tonnes of additional material, resulting in a strip ratio of 11.5:one.

Speaker 3

The plant processed 444,000 tonnes of ore at an average grade of 2.76 gs per tonne gold. Production was sourced primarily from the antenna, anteent and cooler pits. The processing plant operated efficiently with an average throughput rate of two sixteen tonnes per hour, exceeding nameplate capacity by 40%. Third lift of the tailings storage facility is on schedule for completion in the second quarter. The completion of this 8,500,000 project will provide tailings storage into 2029, allowing Sagalah to fully capitalize on its increased throughput capacity and achieve our stated guidance of 160,000 to 180,000 ounces of gold per year from 2026 and beyond.

Speaker 3

All of capital projects are advancing in line with schedule and budget. Seagala's performance resulted in a cash cost of $650 and an all in sustaining cost of $12.90 dollars per ounce. Continued exploration success of the Kingfisher, Sunbird Underground and other deposits supports long term production growth and strengthens the positive outlook beyond the feasibility study targets. At Yaramoko, One Hundred And Forty Four Thousand tonnes of ore were mined at an average grade of 7.1 grams per tonne gold. Ore was primarily sourced from the 55 Zone underground Mine with 21,000 tonnes from Bagassi South at a grade of 8.99 grams per tonne.

Speaker 3

The 109 Zone Open pit began contributing during the quarter with 31,000 tonnes at a grade of 1.1 grams per tonne. The plant processed 135,000 tonnes at an average grade of 7.8 grams per tonne gold. Yaramoko recorded a cash cost of $10.59 dollars and an all in sustaining cost of $14.11 dollars per ounce, aligned with guidance expectations. In the first quarter, Fortuna entered into successful discussions with Soleil Resources regarding the potential sale of the Yaramoko mine and exploration assets in Burkina Faso. These discussions concluded positively, resulting in a signed agreement.

Speaker 3

The final gold fall by Fortuna occurred on April 14, with closing anticipated in early May. This transaction represents a strategic step aligned with our objectives and provides continuity for the workforce at Yaramoko. Thanks and back to you, Jorge.

Speaker 2

Thank you. We'll move on to Latin America. Cesar, you want to give us an update? Sure.

Speaker 4

Thank you, Jorge, and good afternoon to everyone. So let's begin with our Lindero mine in Argentina. Lindero delivered strong production results this quarter. We placed 1,750,000 tons of ore on the leach pad with an average gold grade of 0.55 grams per ton containing approximately 30,943 ounces of gold. Our mining operations extracted 1,460,000 tons of ore, achieving an efficient stripping ratio of 1.8:one, which positively influenced our cost management.

Speaker 4

Gold production for the quarter reached 20,320 ounces, while this reflects a decrease of 24% compared to the previous quarter of 2024, primarily due to an 8% moderate reduced ore grade and the timing of leach in Edex. It is important to note that this production level aligns with our planned mining sequence for the year. A major highlight at Lindero was the highly successful completion of the leach pad expansion project. This expansion was delivered at a total cost of 51,800,000.0 and supports ten more years of mine life. I would also like to provide an update on solar plant project at Lindero.

Speaker 4

As of today, the project is 97% complete, and we have begun pre commissioning activities. The project continues to advance on schedule and well within budget, with full operation expected by the third quarter of twenty twenty five. This solar plant will represent a significant 42% reduction in diesel consumption for power generation. Lindero continues capturing cost reduction from several initiatives, such as the changing of the whole truck fleet from 90 ton Comacho trucks to 45 ton Scania trucks and optimizations on the crushing circuit, plant reagent consumption and drilling equipment to mention a few. Turning to costs at Lindero.

Speaker 4

The cash cost per ounce of gold was $11.47 dollars compared to $10.63 dollars in the fourth quarter of twenty twenty four. This increase is largely attributable to the appreciation of the Argentine peso and the volume of ounces sold. The all in sustaining cash cost per gold ounce sold was $19.11 dollars slightly up from $18.73 dollars in the previous quarter. This reflects the capital investment associated with the completion of the Leach Pad expansion and the bulk of the peak of stripping taking place during the first half of twenty twenty five. However, we anticipate the AC to progressively improve in the next quarter as we expect to gravitate towards a mine with an AISC of $1,400 by the end of the year.

Speaker 4

Now let's move to our Carrioma mine in Peru. The team there also delivered outstanding results. Silver production reached 243,000 ounces from 137,000 tons milled, maintaining a consistent average head grade of 67 grams per ton. We also achieved significant production of lead and zinc with 8,800,000 pounds and 13,800,000 pounds produced, respectively. The average head grades were 3.21% for lead and 5% for zinc.

Speaker 4

Production of all three metals remained consistent when compared to the fourth quarter of twenty twenty four, in line with our mine plan for year. Regarding costs at Caylloma, which are reported on a silver equivalent basis, the cash cost per silver equivalent ounce sold was $12.8 compared to $16.53 in the fourth quarter of twenty twenty four. The all in sustaining cash cost per ounce of payable silver equivalent decreased to $18.74 down from $28.1 in the previous quarter. These costs adjustments reflect consistent cost savings and lower capital investments for the period, offset primarily by slightly lower silver production in the period and the benefit from the higher realized silver price on the silver equivalent calculation. In conclusion, our Latin American operations demonstrated a strong first quarter in twenty twenty five.

Speaker 4

We maintained a focus on excellent safety performance, achieved key production targets and successfully completed strategic projects like the Lindero Leach Pad expansion. We remain committed to optimizing our operational efficiency and delivering sustainable value to our stakeholders.

Speaker 2

Back to you, Jorge. Thank you. Now we'll go to the CFO report.

Speaker 5

Thank you. I will be mostly making reference to Q1 twenty twenty four as a comparison period where we have excluded San Jose for comparability purposes. As Jorge has mentioned, attributable net income from continuing operations for the quarter was $61,700,000 or $0.20 per share. This compares to $09 in Q1 twenty twenty four. Our strong financial performance in the quarter was a result of record high metal prices and cost per ounce in line with our guidance for the year.

Speaker 5

Our average realized gold price in the period was $2,880 per ounce compared to $2,087 per ounce in Q1 of twenty twenty four. Our cash cost per gold equivalent ounce was $929 and all in sustaining cost was $16.40 dollars per ounce, again, both aligned with management expectations. A few comments on the financials. Depreciation and depletion in the quarter was $61,000,000 which we'd like to remind includes $18,500,000 in depletion of the purchase price related to the acquisition of Rockshole in 2021. General and administration expenses were $25,300,000 an increase of $8,500,000 year over year as shown in the breakdown we provide in Page 10 of our MD and A.

Speaker 5

The increase comes mainly from stock based compensation associated with a 42% rise in our share price during the quarter. Our effective tax rate was 25% for the quarter compared to 34% in Q1 twenty twenty four. The decrease is a function of the appreciation of the euro versus the U. S. Dollar in the quarter.

Speaker 5

At current metal prices, we expect our effective tax rate to be in the 28% to 30% range and our current tax rate to be in the 32% to 35% range. Moving on to our cash flow statement. We reported $111,300,000 of free cash flow from ongoing operations, which excludes new development projects and growth initiatives. We should note that we expect to pay over $60,000,000 of taxes in 2024, of which the bulk will be paid in Q2 and Q3 as a result of this timing effect and everything else being equal, we should expect somewhat lower free cash flow in the next two quarters. In the investing section of the cash flow statement, we recorded 39,500,000 under additions to property, plant and equipment consisting of approximately $33,300,000 of mine site capital, which includes $6,000,000 of brownfields exploration and $6,200,000 related to the Diaamba Zap project and greenfield exploration.

Speaker 5

Moving on to the balance sheet. We closed the quarter with a cash position of $3.00 $9,000,000 and a net cash position after financial debt of $137,000,000 Our total liquidity was $459,000,000 including the full undrawn amount of our 150,000,000 revolving credit facility. Thank you. Back to you, Jorge.

Speaker 2

Carlos, questions?

Speaker 1

We would now like to open the call to any questions that you may have. Jamie, please go ahead.

Operator

Thank you very much. We'll now be conducting our question and answer you. Thank you very much. Your first question is coming from Mohamed Sadeed of National Bank Financial. Mohamed, your line is live.

Speaker 6

Thank you, operator. Hi, operator and team. I just had a question on capital allocation priorities following the sale of the San Jose mine and Yaramoko mine that is expected to close. And specifically as it relates to potentially inorganic opportunities that you may be looking at, what are some of the criteria that you're looking at in terms of size, jurisdiction, stage of assets? Thank you.

Speaker 2

Yes. First, let me stress before I speak about inorganic growth, we believe we have strong opportunities to fuel growth organically, which are high impact. One is the expansion, we'll reiterate the expansion of the Seguela mine, which today is our lowest cost mine. On this first approach towards an expansion, we're moving from about 140,000 ounces of annual gold delivery to a range of 160,000 to 180,000 ounces with opportunities for more. We continue to see a lot of continued exploration success there as evidenced by the discoveries of the Sunbird deposit, the Kingfisher deposit, the extension of Sandberg Deep for underground mining.

Speaker 2

So we're very encouraged by that and the continued opportunities for growth at our lowest cost operation. Second is the Segela, the Diambasud project in Senegal. Diambasud is an advanced stage exploration late stage exploration, advanced stage development, that's how I would rate it. We have a well funded program in 2025, where we're advancing exploration concurrent with permitting, environmental studies and engineering studies as well. So we continue to approach the advance of Segela sorry, of the Ambassador on a fast track approach.

Speaker 2

That's organic. Then when we think of opportunities outside the farm, we are very focused on the two regions where we are already established, where we have established management teams, strong local expertise. So you will see us active in West Africa and the general region in Latin America. We favor primarily countries where we already have operations within these two regions, of course, but we will move within the regions. And projects that come into the pipeline are preferred, although we will see we're more than chasing ounces, we'll be chasing value.

Speaker 2

We're chasing value. So you will see us keep discipline. If we see we'll look at the full spectrum of opportunities from earlier stage to post discovery, pre development. We see a lot of opportunity there. We still see and identify value in some of the opportunities that we track.

Speaker 2

What are we looking for? Projects that can deliver over a decade in the loans and at costs that sit at or opportunities to go below the average cost curve and meaningful production that for us means anything north of 120,000, one hundred and 50 thousand ounces of gold production. We believe that we have a clear path to support production in the range of 400 to 500,000 ounces between what we have in the portfolio and opportunities that we see out there. Thanks a lot

Speaker 6

for that. And if I could just maybe follow-up on that, as you look at your current portfolio right now, should we expect maybe any potential rationalization? I'm just looking at I think Segolite is very clear. You have a ton of excitement and opportunities. Mean, there are you have some opportunities as well.

Speaker 6

But Caylloma may be like how do you think about that asset? And how do you think about your current portfolio?

Speaker 2

Yes. Caylloma is certainly the smallest mine in the portfolio. It was our first mine. And I always say there is no headache free mine, but if there is one mine that gets close to that, is Caylloma. The team there does an excellent job.

Speaker 2

Today, if you account for resources and reserves, we can see a mine operating for close to a decade. It's a mine that every year generates free cash flow for us. So it gives us a strong presence in an exciting mining jurisdiction with a deep rooted mining tradition like Peru. So we see Caylloma as a fit in our portfolio today.

Speaker 6

Great. Thank you. Thanks for taking my question.

Operator

Thank you very much. Your next question is coming from David Sinney, who's a private investor. David, your line is live.

Speaker 6

Yes. My question is, with an excellent quarter results hitting $0.20 profit per share. I just want to know how is it that financial analysts can have such influence over the stock price, which is presently trading down just shy of 12%. And you missed their expectations by a penny a share, and and it's created a 12% deficit for today. I just don't understand.

Speaker 2

Perhaps that's a question for the analysts. But I we focus on what we control. We believe, as I stressed in the call, that this is a record quarter. We're delivering where it matters the most in free cash flow. We're controlling our cost and we're fully capturing the benefit of higher prices.

Speaker 2

I believe that Fortuna has put together a rock solid balance sheet, is generating a very strong free cash flow. It's managing the operations, controlling the risks. And we are set to continue benefiting from this price environment precious metals. Price swings in the stock, difficult to comment on. We're looking at it and we also, have to admit, scratch our head a bit, but markets come and go, prices go up and come down.

Speaker 2

The important thing is the fundamentals of

Speaker 1

the business.

Speaker 2

And Fortuna has never been as strong as it is today. The balance sheet, the property portfolio, the cost management, the execution, operational excellence. So again, I have never seen in twenty years Fortuna as strong as it is today with the capabilities to continue delivering for shareholders, right?

Speaker 6

Thank you. I appreciate that. I don't disagree with you. I just don't understand how they're able to do But thank you very much.

Speaker 5

Thank you.

Operator

Thank you very much. Your next question is coming from Adrian Day of Adrian Day Asset Management. Adrian, your line is live.

Speaker 7

And good Exploration fits into your picture, both solo Greenfields and also partnerships.

Speaker 2

I did not quite get the very beginning of the question. It's about I'm sorry.

Speaker 7

Yes, Greenfields exploration. How does that fit into the way you look at growth?

Speaker 2

Yes, yes. Let me first give you a refresh on our growth initiatives. This year, we have increased our exploration and new project budget to $51,000,000 up from $41,000,000 in 2024. So we're expanding our exploration initiatives. Know Adrian, we're quite active with exploration in our key projects, key properties.

Speaker 2

And to the point of your question, greenfield, sometimes we don't speak about or speak enough about our early stage exploration initiatives. And let me go into some of them. Right now, we have an active drill program in Northern Cote D'Ivoire, the Tonghon project. We have a 5,000 meter sorry, 10,000 meter drill program ongoing there. It's a large land package north of the Barrick Stongon mine in Northern Cote D'Ivoire.

Speaker 2

And it's early stage exploration on the right rocks, on the right structures with strong geochemical signatures on surface from ogre and soil work. So we are excited about that program. It's advancing. I would say we're a third advanced with the drilling there. And we look forward to report on that in the coming weeks, start reporting on Tongon and being able to talk more about Tongon in the coming weeks.

Speaker 2

In Mexico, we have currently three we're entering or looking into entering into three joint venture opportunities, option agreements for joint venture opportunities. So we continue to seek opportunities in Mexico. Those are greenfield initiatives, early stage type projects. In Peru, even though our work centers mainly in the Caylloma Mine and the vein system around the Caylloma Mine, we have within our property package two, I would say, different type projects for disseminated the targets are disseminated silver, disseminated gold are the Antacollo and Santa Rosa projects. So even though they are within the Cayuga land package, which is quite extensive, these are projects that would be new, would not necessarily feed the Caylloma plant.

Speaker 2

These are disseminated gold and silver type targets. So we are gearing to start drilling and testing those targets towards midyear, second half of the year. And we also have initiatives in Argentina. In Senegal going back to West Africa, we talk about the Ambassador and we speak of the Ambassador as a project, but we have a very large land package around Seguela. And we are also our work has focused initially at the project level at the Ambazut, but now we're starting to move out into the peripheries and boundaries of our concession packages.

Speaker 2

So all in all, my message is we're very active across the jurisdictions on or greenfield initiatives. And sometimes we don't speak a lot about them, but as work progresses and those mature, some of them will mature, we will start communicating more, right?

Speaker 7

Okay. No. That's excellent. That's a lot of projects. Thank you.

Operator

Thank you very much. Okay. We appear to have reached the end of our question apologies, we do have a question just come in. If you'd like to take it, it's from David Krantzler of The Mining Stock Journal. David, your line is live.

Speaker 8

Thank you. Hi, Jorge. I'll see you later on Chris' podcast, Arcadia Economics. I think the market right now is kind of misunderstanding the results that you released. I just have a couple of questions here.

Speaker 8

How much will Fortuna save in closure costs from the sale of Yaramoko in San Jose?

Speaker 2

Hello, Dave, and look forward to our conversation later today. Dollars 50,000,000 on aggregate is what we would estimate is the capital that would need to be allocated to phase the mine closures of both Yaramoko and San Jose. And on top of that, those are $50,000,000 that would be invested, allocated towards mine closure over a period of years, no, four, five, six years, right? Because it's the closure plus monitoring activity that go. So the savings, I believe, are significant, but equally important is those are long term projects that need to be managed and managed well as well.

Speaker 2

So management's attention, I believe, is key here. And we're not only saving on the $50,000,000 but we're also being able to reallocate management and human capital, human resources towards those higher value opportunities that we have in the portfolio and across the other things that we're looking at.

Speaker 8

Okay. And then my next question is, do you have a timeline for the advancement of the Ambassador to a construction decision?

Speaker 6

Yes.

Speaker 2

We as I explained earlier in the call, we're advancing on three tracks. We aim to migrate the exploration concession we have at the Anbazut into an exploitation concession by mid year twenty twenty six. So in order to do that, we are advancing our environmental studies, our engineering studies, and concurrent with that, we continue drilling like hell here. So the objective is that by mid-twenty twenty six, we are in a position to be able to call a construction decision. Mid-twenty twenty six, probably a construction decision will follow shortly after gaining the exploitation concession towards, I would say, second half of twenty twenty six, we should be in a position to consider a construction decision.

Speaker 8

Okay. And then one last question. Do you have a timeline yet for incorporating Kingfisher into the life of mine plan at Seguela?

Speaker 2

I would expect that Kingfisher can be incorporated by end of this year. We will be releasing our consolidated resource and reserve statements mineral resource, mineral reserve statement in early twenty twenty six, And you should see Kingfisher in those mine plans in the reserve. So we all of this year, we are drilling aggressively this first half of the year. We've been drilling aggressively in field drilling and we continue with that program. And now we are close to completion with the infill program.

Speaker 2

And now we are also working on opportunities that we identified through the infill program to continue extending mineralization. So we're doing those two in parallel, infill plus growth within the Kingfisher deposit. But to go back to the basic question, you should seek increase in the reserves in the mine plans by year end reported early next year.

Speaker 8

Okay. Thank you. That's all I've got. And I will talk to you later on the Arcadia Economics podcast.

Speaker 2

Thank you. Look forward to the update.

Operator

Bye. Thank you very much. Our next question is coming from Thomas Bethanovitz, who's a private investor. Thomas, your line is live.

Speaker 9

Yes, Jorge. I I've been buying all the way down on this sell off, and I really don't understand why. But, my comment is I hope you're buying it with me because this is a fantastic deal as I'm concerned. That's all I have to say.

Speaker 2

Thank you for the comment and well noticed.

Operator

Thank you very much. Well, we appear to have reached the end of our question and answer session. I will now hand back over to the management team for any final comments.

Speaker 1

If there are no further questions, I'd like to thank everyone for joining us on today's earnings call. We appreciate your continued support and interest in Fortuna Mining. Have a great day.

Operator

Thank you very much. That does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful rest of the day. We thank you for your participation.

Powered by Quartr

Key Takeaways

  • Fortuna achieved record free cash flow from operations of $111 million in Q1, with margins rising to 38% from 31% in Q4.
  • The company lowered its cash cost per ounce to $929 and all-in sustaining cost to $1,640, reflecting disciplined cost control amid strong gold prices.
  • Strategic portfolio optimization included the April sale of the San Jose mine and the pending Yaramoko divestment, freeing ~\$50 million in capital and management focus.
  • Fortuna reserved \$51 million for exploration in 2025, advancing high-impact projects such as Kingfisher, Diamba Sud and the Seguela expansion to ~180,000 ounces by 2026.
  • The balance sheet strengthened with net cash doubling to \$137 million, total liquidity of \$462 million, and a Q1 share buyback of over 900,000 shares at \$4.53.
A.I. generated. May contain errors.
Earnings Conference Call
Fortuna Silver Mines Q1 2025
00:00 / 00:00